GM, Chinese ally start work on Nano rival

General Motors India has begun research & development for a car smaller than the Spark in India.

The company plans to use its partner SAIC Motor Corp’s expertise in low-cost manufacturing to make this project cost competitive and may look at launching this vehicle in the Nano segment — in the Rs 2 lakh price bracket — in the next few years.

Karl Slym, president and managing director, GM India, admitted the company is “open to having a value car smaller than the Spark and work has already begun on it in India”.

Slym said low-cost manufacturing — plant, equipment, vendor, tooling and other such expenses — must be spread over vehicle sales to be able to develop a viable low-cost vehicle.

“SAIC, our 50% joint venture partner in India, is very advanced on such low-cost manufacturing and we will use its expertise (in developing the value car)”.

While denying any substantial component sourcing from SAIC’s home turf, China, Slym said a lot of money is “wasted in duties and logistics if one were to import components from China. Our endeavor is to use low cost supply base in India”.

He said GM India has already sounded out suppliers on the need for low cost parts for this “value” car but declined to answer a query on the lessons and learnings it would derive from the Tata Nano, currently the world’s cheapest car.

Earlier, GM had indicated its willingness to come out with a $5,000 car and Slym said that the car being developed may not actually fall in the Rs 1 lakh bracket but could be priced towards the higher end of Nano price band.

Companies such as Maruti Suzuki India are also readying for launch in this segment.

Then, Slym also acknowledged GM’s interest in bringing to India the hatchback and the notchback version of ‘Sail’.

This would be the first joint venture vehicle to be launched in India; GM has already conducted extensive car clinics last month in Chennai and some other cities for both variants of this car.

Slym said ‘Sail’ received a good response from anonymous customers during this clinics, which were conducted for a month.

On the breakup of GM India’s partnership with Reva Electric Car Company recently, Slym said that the project envisaging an electric Spark has been abandoned.

Instead, GM India will now look to develop an electric car in the United States, with help from Indian engineers, suited to Indian needs.

GM currently sells the Spark, Aveo, Aveo UVA, Beat, Captiva, Optra, Cruze and Tavera in India. Its total manufacturing capacity across two plants stands at 3.85 lakh units.