GM India Plans Rs 2 Lakh Car

General Motors has entered the bankruptcy protection plea in Unite States, but its subsidiary in India has ambitious plans for the country. The company is planning to develop small cars possibly with a price tag of Rs 2 lakh.

Speaking to media persons, the vice president at General Motors Group, Mr. Nick Reilly said "the company was studying the option to develop a small car from India. The new car will be positioned below the Spark Mini Car. We believe that there is an opportunity for high volumes in a mini car offering be priced lower than Spark." He clarified the sub Rs 2 lakh car will not compete with Tata Nano car. Spark currently, costs Rs 2.66 lakh (ex-showroom Delhi). Currently, it is the cheapest car for General Motors globally.

General Motors will base their research and development centre in India. The car is targeting a price tag of Rs 2 lakh and apart from India, the car could be positioned in similar markets in South America, Eastern Europe, Africa and even China.

India could be the hub for manufacturing the small car, especially as its is a primary market for small cars itself. A global growth in demand for small cars will give India an attractive opportunity.

The company also plans to increase local content on its India made cars to make them more price competitive.

Sources: http://blog.carazoo.com/2009/06/general-motors-to-file-for-bankruptcy.html;