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GM India to sell engines to other auto biggies

Published On Mar 07, 2011 05:24 PM By Ritesh for Chevrolet Aveo

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The Indian auto market is growing at a rate of 30 per cent and with an increasing demand for cars the auto mobile companies which are already established are investing in engine unit by building there own set up rather than coming with a local channel. However, few auto companies who are working in a larger set up plan to take the advantage of it. As per a close source, General Motors India who owns a manufacturing unit in Talegaon near Pune is all set to sell small capacity powertrain manufactured from the Maharashtra unit to companies who wish to have a sourcing pact from it.

GM is the fourth largest auto company in the Indian domestic auto market who manufactures 300,000 powertrain yearly from its Talegaon plant is now all set to out source the engines for different Indian and abroad companies. The manufacturing unit is General Motors' first engine manufacturing unit which enables the production of petrol or diesel simultaneously. The plant was set up with an investment of $230 million (around Rs 1000 crore), it can manufacturer three and four cylinder powertrain. Since last November, the US based auto company has started the engine manufacturing, currently it manufactures engines for Chevrolet Beat. The auto company has apparently spent Rs 322 crore in manufacturing 1 liter and 1.2 liter diesel and petroleum mills.

Karl Slym, president and managing director, GM India said that the auto company plans to roll out 300,000 cars yearly by 2013. For that the auto company is willing to start selling yearly 300,000 powertrains from this year onwards in the domestic auto market. The company is open to sell or buy the engines to anyone however, it should make business. He also added that the auto company has the opportunities to export the products to China as it has joint ventures here. The company plans to export engines or its components there.

As per the sources it is required to own an engine unit to keep the volume high and cost factor low which is why many automotives are in a process of owning a powertrain plant. Reliable sources revealed that Maruti Suzuki India is facing a major crunch mainly in the diesel engine. The Indian auto giant has multiple options for petrol engines, however for diesel its only one.

R C Bhargav the Chairman of the company said that the availability for the diesel variant is less and the company also wishes that the mills should be as per Marutis' standards.

The other auto giants like Renault and Nissan plans are also planning to set up its engine unit in India when they will own a greater share in India. Hyundai is also working towards setting up an engine unit which will produce 150,000 units every year in Chennai.

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