GM buy means Matiz will return as Chevrolet Spark

Daewoo Matiz, which enjoyed a fairly successful run in the country, will make a comeback on the Indian roads in its brand new avatar as the Chevrolet Spark.

After 18 months of now we will, now we won't, General Motors finally offered to buy the car assembly assets of the embattled Daewoo Motors this Wednesday. And as per plan it will use the Surajpur facility to manufacture its 'mini' car offering.

General Motors has shown an interest only in the car assembly unit because the engine and transmission unit at the Surajpur plant is not equipped not make the 800 cc engines for small car.

Daewoo shipped engines and transmission in from South Korea and looks like GM will follow suit and import the engine and other critical parts from South Korea.

Aditya Vij, president and managing director of General Motors India told Business Standard "being a small car a high level of local content is important but we do expect to source the powertrain from GM-DAT (Daewoo Automotive Technologies), in all probability from South Korea." That means close to 72 per cent of the car will be localised by the time of roll out.

Vij refused to comment on the pricing but added that it would be "an entry B-segment car", which puts it in the in the Rs 3 - 4.5 lakh segment.

The car continues to sell in South Korea and UK as the Daewoo Matiz but cruises the roads of China as the Chevrolet Spark.

Since GM India has decided on the Chevrolet brand to drive its growth in the domestic market, the Daewoo Matiz will masquerade on the Indian roads as the Chevy Spark.

More importantly the three cylinder 800 CC engine which was a weak link in the Daewoo product will give way to a more powerful and efficient 1100 CC four cylinder unit. The car will also look significantly different from the Matiz Indians are familiar with.

General Motors is still in the process of conducting the due diligence at the Surajpur facility and the deal is likely to be inked in another 2-3 months. According to GM officials the car will hit the roads only in the next calendar year.

The Surajpur facility has a capacity to manufacture 85,000 cars per year.