China's SAIC Motor
gears up for Indian roads; hires ex-GM head
Even as
Chinese companies have been sellers of everything from toys to electronics in India, SAIC will be the first Chinese company to enter the automobile space. Chinese automobile company SAIC Motor has started hiring executives for its planned foray into the Indian markets, reports the Economic Times today. Even as Chinese companies have been sellers of everything from toys to electronics in India, SAIC will be the first Chinese company to enter the automobile space. SAIC will sell in the Indian markets through its local unit – MG Motor India, a British brand which it had acquired from another Chinese firm Nanjing Automobile almost a decade ago. The cars sold here will be tagged under the MG Motor brand, which has been registered in India. Former India head of General Motors, Rajeev Chhaba, is slated to be the CEO, while seven others have been hired to lead the finance, human resources, purchase, IT and other departments. SAIC also has the Competition Commission of India’s approval to acquire the Halol (Gujarat) factory of General Motors, which is SAIC’s China partner. But the deal will depend on settlement of labour issues at the plant by GM.
If GM is able to settle the labour issues by mid-next month, the Chinese company will be set to take over the plant as early as in April. If things settle as planned, the company should be able to roll out its first vehicle from the plant late next year or early 2019. However, experts point out it may not be a smooth sail for the company, primarily due to apprehensions on quality and safety. The issue is magnified by the fact that other major global automakers such as Volkswagen, Fiat, Ford Motor and GM have not been able to establish a foothold here even after a decade of existence in the country. But they also note, quality products at cheaper rates can dent existing markets. SAIC has hired KPMG to conduct the market study, while PwC has undertaken a study on the cost of the GM plant. It has also roped in EY to help it finalise suppliers. The immediate hurdle to start operations are labour issues at the GM plant.
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Chinese companies have been sellers of everything from toys to electronics in India, SAIC will be the first Chinese company to enter the automobile space. Chinese automobile company SAIC Motor has started hiring executives for its planned foray into the Indian markets, reports the Economic Times today. Even as Chinese companies have been sellers of everything from toys to electronics in India, SAIC will be the first Chinese company to enter the automobile space. SAIC will sell in the Indian markets through its local unit – MG Motor India, a British brand which it had acquired from another Chinese firm Nanjing Automobile almost a decade ago. The cars sold here will be tagged under the MG Motor brand, which has been registered in India. Former India head of General Motors, Rajeev Chhaba, is slated to be the CEO, while seven others have been hired to lead the finance, human resources, purchase, IT and other departments. SAIC also has the Competition Commission of India’s approval to acquire the Halol (Gujarat) factory of General Motors, which is SAIC’s China partner. But the deal will depend on settlement of labour issues at the plant by GM.
If GM is able to settle the labour issues by mid-next month, the Chinese company will be set to take over the plant as early as in April. If things settle as planned, the company should be able to roll out its first vehicle from the plant late next year or early 2019. However, experts point out it may not be a smooth sail for the company, primarily due to apprehensions on quality and safety. The issue is magnified by the fact that other major global automakers such as Volkswagen, Fiat, Ford Motor and GM have not been able to establish a foothold here even after a decade of existence in the country. But they also note, quality products at cheaper rates can dent existing markets. SAIC has hired KPMG to conduct the market study, while PwC has undertaken a study on the cost of the GM plant. It has also roped in EY to help it finalise suppliers. The immediate hurdle to start operations are labour issues at the GM plant.
Read more for Indian Stock Tips- http://bit.ly/ace_services
