General Motors may sell Halol facility in Gujarat, production till March

US auto major General Motors today said it would continue production from its Halol plant in Gujarat until March next year, even as it continues to review...

By: | Published: June 23, 2016 5:18 PM
The automaker had earlier decided to stop production at the Halol plant by second half of 2016. (Reuters) The automaker had earlier decided to stop production at the Halol plant by second half of 2016. (Reuters)

US auto major General Motors today said it would continue production from its Halol plant in Gujarat until March next year, even as it continues to review future options including sale of the facility.

The automaker had earlier decided to stop production at the Halol plant by second half of 2016.

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Last year, the company had announced a turnaround plan for India entailing fresh investment of $1 billion and ceasing production at its Gujarat plant to consolidate manufacturing operations in Maharashtra.

GM India President and Managing Director Kaher Kazem said the extension of manufacturing at Halol will provide more time to ensure an orderly transition for employees, suppliers and other stakeholders as the company continues to work through options for the facility.

"GM India will continue with our plan to consolidate manufacturing at our Talegaon plant. We are exploring a number of options in relation to the Halol site, including its sale. Selling the plant may include contract manufacturing to ensure continuity for the upgraded Chevrolet Tavera," Kazem said in a statement.

Besides other models, the company also plans to produce the upgraded version of its multi purpose vehicle Tavera at the Halol plant, the company said.

GM India recently announced its plan to launch at least five new Chevrolet models within the space of 24 months, including the new Trailblazer, new Beat, Essentia new Cruze and Beat Activ.

As per the company's plans announced last year, the Halol plant was supposed to stop production by the second half of 2016.

The move would have affected 1,100 employees at the plant that has a total annual manufacturing capacity of 1.1 lakh units.

The company's move was reported to have been rejected by the Gujarat government which demanded a concrete settlement plan for the workers.

On the other hand, General Motors is planning to increase capacity of the Talegaon plant to 2.2 lakh from its current 1.3 lakh units annually. It will create 12,000 jobs for GM India and its suppliers.

General Motors has been in India since 1996, starting production at the Halol plant, and has invested around a billion dollars so far in the country. As of last year, it had reportedly accumulated a loss of Rs 2,740 crore in its nearly two decades of existence in India.

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