New Delhi/Shanghai: General Motors (GM) on Friday said it has stopped sales of its closed Indian plant to China. great Wall Motor, after failing to get regulatory approvals, comes amid New Delhi’s tough stance towards investments from Beijing.
GM struck a deal in January 2020 to sell the plant to Great Wall, the Chinese SUV-maker for $300 million as part of a broader plan to invest $1 billion to establish a presence in India’s growing car market. expected to pay up to Rs.
The agreement, which was extended twice, expired on June 30.
“We have been unable to obtain the necessary approvals within the deal’s deadline,” said Jorge Swigos, executive director of communications. GM Internationaltold Reuters.
“Our strategy in India remains unchanged and we will now explore more options for the sale of the site,” he said, adding that the company “expects to achieve a value that reflects the value of the asset”.
“Great Wall Motor will continue to focus on the Indian market in the future and continue to explore new opportunities,” the Chinese automaker said in a statement on Friday, confirming the termination of the plant deal.
The Indian government did not immediately respond to an email seeking comment.
GM’s deal with the Great Wall was agreed months before India toughened its stance on investments from neighboring countries, including China, in April 2020, making them the first major casualties of the move, which has hit sectors like automobiles and the like. Billions of dollars in capital flows were stopped. technology.
It was part of a broader crackdown by India on businesses with Chinese ties amid deteriorating diplomatic ties. Separately, New Delhi also banned over 300 Chinese mobile apps, including TIC Tocon security concerns.
The move draws a line as part of a more than two-year effort by GM and Great Wall to force the US firm to resume its hunt for a buyer while it removes some machinery and tooling at the factory. Continues to spend money on maintaining.
Asked whether the plant could be used to make electric vehicles, Swigos said it is suitable for a number of industrial uses, including for non-automotive companies, and that GM will explore all options.
GM, which stopped selling cars in India in late 2017, has already sold its second plant SAIC Motor Corp.Where the Chinese automaker manufactures cars under its British brand, MG Motor,
It would also send Great Wall back to the drawing board on its plans to enter India, which it saw as a key part of its global strategy to break into new markets. Latin AmericaThailand and Brazil.
Last year, Great Wall re-allocated a portion of a $1 billion investment earmarked for India to Brazil and reassigned some of its staff after delays in obtaining government approval.
GM struck a deal in January 2020 to sell the plant to Great Wall, the Chinese SUV-maker for $300 million as part of a broader plan to invest $1 billion to establish a presence in India’s growing car market. expected to pay up to Rs.
The agreement, which was extended twice, expired on June 30.
“We have been unable to obtain the necessary approvals within the deal’s deadline,” said Jorge Swigos, executive director of communications. GM Internationaltold Reuters.
“Our strategy in India remains unchanged and we will now explore more options for the sale of the site,” he said, adding that the company “expects to achieve a value that reflects the value of the asset”.
“Great Wall Motor will continue to focus on the Indian market in the future and continue to explore new opportunities,” the Chinese automaker said in a statement on Friday, confirming the termination of the plant deal.
The Indian government did not immediately respond to an email seeking comment.
GM’s deal with the Great Wall was agreed months before India toughened its stance on investments from neighboring countries, including China, in April 2020, making them the first major casualties of the move, which has hit sectors like automobiles and the like. Billions of dollars in capital flows were stopped. technology.
It was part of a broader crackdown by India on businesses with Chinese ties amid deteriorating diplomatic ties. Separately, New Delhi also banned over 300 Chinese mobile apps, including TIC Tocon security concerns.
The move draws a line as part of a more than two-year effort by GM and Great Wall to force the US firm to resume its hunt for a buyer while it removes some machinery and tooling at the factory. Continues to spend money on maintaining.
Asked whether the plant could be used to make electric vehicles, Swigos said it is suitable for a number of industrial uses, including for non-automotive companies, and that GM will explore all options.
GM, which stopped selling cars in India in late 2017, has already sold its second plant SAIC Motor Corp.Where the Chinese automaker manufactures cars under its British brand, MG Motor,
It would also send Great Wall back to the drawing board on its plans to enter India, which it saw as a key part of its global strategy to break into new markets. Latin AmericaThailand and Brazil.
Last year, Great Wall re-allocated a portion of a $1 billion investment earmarked for India to Brazil and reassigned some of its staff after delays in obtaining government approval.