GM turns in profits

General Motors India (GMI) has achieved financial break-even and posted its first cash profits during the year ended March 31.

The company has invested nearly Rs 1,200 crore ever since it began operations in the mid-90s. This includes an investment of Rs 500 crore for the newly launched MUV (multi utility vehicle) Chevrolet Tavera.

Addressing the media during the launch of Tavera, Aditya Vij, president and managing director, GM India, said, "We are a profitable company, unlike in the last year."

GMI had also obtained a clearance from the Foreign Investment Promotion Board (FIPB) for extending its overall investment to Rs 1,380 crore.

However, since the FIPB approval is no more necessary, officials at GMI feel that further investments will be need-based. For now, the company plans to invest an additional Rs 180 crore by the year end. Details of the proposed investment is yet to be ascertained.

Buoyed by the success, GMI will focus on expanding its existing manufacturing facility at Halol. This unit manufactures all its brands, namely Corsa, Corsa Sail, Swing, Optra and Tavera.

By starting an additional shift at Halol plant, GMI officials believe that it would take care of the current year's demand of Chevrolet Tavera.

Having manufactured 15,155 cars in the previous fiscal, the company intends to increase its output to nearly 30,000 cars during this fiscal. The company plans to sell 10,000 units of Tavera this fiscal.

Currently, the Halol manufacturing plant has a production capacity of 33,000 units. As GMI will near its production capacity during the current fiscal, plans are afoot to expand this plant. The expansion will increase its production capacity to 50,000 units.

Interestingly, Tavera has seen 85 per cent localisation. This will increase to 93 per cent by the end of this year.

Indicating that this showcases GM's reliability on the Indian market, Vij said, "As we increase our presence in Asia, we will focus towards building capabilities. Our technology centre in Bangalore is working on building capabilities as well as certain R&D initiatives, so as to be in tune with the remaining technology centres of GM."