China tensions trip General Motors unit sale
NEW DELHI: General Motors will shut down its last factory in India a day before Christmas, the fallout of raging tension between India and China. GM wanted to sell its Maharashtra factory to Great Wall Motors, China’s largest SUV maker, for over Rs 2,000 crore, but India has not cleared the deal.
With the closure of the Talegaon plant on Thursday, GM will bring the curtains down on its India operations which began in 1996. GM had already sold its other Indian factory (at Halol in Gujarat) to China’s SAIC in 2017, which is now being used by MG Motors.
There are 1,800 salaried and hourly employees at the Talegaon site, a source said.
The deal between GM and Great Wall was announced in January when they signed a binding term sheet, and this was to close in the second half of the year.
However, in April, India put in place stricter rules for investments from China and other neighbouring countries. And in June, after the killing of 20 Indian soldiers in Ladakh, Maharashtra said it was putting the GM-Great Wall and two other deals (worth Rs 5,000 crore) on hold.
Amid the hostility, the go nment had decided to scrutinise all investment decisions from neighbouring countries in a move that was aimed at holding up flows from China. The Talegaon plant was being used to export cars, primarily the Chevrolet Beat, to Meco. This has now stopped, forcing the company to shut down the factory with no deal in place with Great Wall.
It is understood that GM has told shop floor workers that they will paid salary till January 25. The GM India spokesperson remained hopeful of a solution to get the deal moving. “Both companies continue to work with all relevant authorities to secure necessary go nment approvals to support the transaction, which will deliver future jobs at the site.”
Chinese are termites, keep them away.. As a country, that is what we should do..
India must not allow China to buy into this. Indeed the whole World has to start shedding all business relationships with China because if this doesn't happen China will keep on increasing its economic strength they will dominate the World for their own selfish ends. A Democrat US Government will be of no help as they will not stand in the way of their friends in China.
Let TATAs buy the plant
INDIA BUCK UP WE ARE NOT AFTER MATERIAL GAINS WE HAVE TO HAVE CHARACTER FIRST.I SALUTE MODIJI.
Scrap the deal and open up possibilities for buyout by other investors. Govt is right in using every tool to put pressure on China. GM will sell it to others when they realizes china deals won't be allowed.
The plant should be handed over to an Indian company.
Sajjan Singh Shaktawat
TATA should takeover.
Just block China & related entities from India totally. Not just this deal.
Chinese buyers of the factory are not welcomed.
Don't let them in as they are dangerous to society, security..please but give alternate jobs to the persons affected..
why Chinese company, why can't GM bring in auto makers from any other country...
Because no one else is interested.
In one hand, India is looking to foreign investment and become a world factory. In the other hand, India is so scared of foreign investment. If you don't have the courage to make a reform. You should not expect any big step forward.
GOI should act sensibly & take decision with long time interest of the country.We should prevent only the Chinese govt aided companies to buy any company in India rather than every investor.
Help Your Society
why can not they sell to an Indian company or a foreigtn car company who have shop in India like Kia or Huyandai ?
Most of foreign countries have closed their manufacturing car plant on India. Ford , GM, Honda ( Noida Plant).
India consumer like cheap product like Maruti and cheap Chinese cars.
Who would like to buy a car factories in India, even Toyota, BMW have put a hold on all expansion plan in India as Indian go nment changes rules everyday and pressure tactics of raids.
Only Chinese players can survive in Indian car market.
Not a right trend.... This will deter investors to invest in the country and create more employment opportunities.... Think of the staff at GM... They are left nowhere and go nment is nowhere to stand as backup for it's own citizen