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GM To Invest $5 Billion On New Small Cars For Emerging Markets

The new set of small cars for emerging markets will get modern technologies, improved connectivity, high fuel economy and right levels of safety.

The new range of cars will bring in sales close to 2 million units every year

As part of its turnaround plan for emerging markets, General Motors has announced that it will be spending $5 billion (Rs. 32,000 crores) over the next few years to develop a new architecture that will underpin a new range of small cars for emerging markets, sold under the ‘Chevrolet’ badge. The American automaker is working on the new platform and powertrain for these vehicles in collaboration with its Chinese partner Shanghai Automotive Industry Corporation (SAIC), with the first car scheduled to go on sale by 2019. The new lineup of small cars are expected to bring in volumes close to 2 million units annually.

Markets including India, China, Brazil, Mexico and the likes have a huge potential for growth and being volume centric places, they also provide higher economies of scale. General Motors iterated that the new lineup of cars will be equipped with modern technologies, safety systems, connectivity options and good fuel economy, parameters that are looked out for today by customers even in emerging markets. In addition, the automaker stated that it will build content-rich vehicles and retail them at affordable prices. The company will be working on a host of body styles based on the new architecture, but hasn’t specified yet which will be the first product to go on sale.

The new architecture is extremely important for GM on a global scale as well as the company is looking to replace some of its existing platforms with the new one. At present, 75 percent of GM’s models are based on 14 different core architectures. However, the automaker plans to have just 4 vehicle architectures by 2025 that will underpin most of the vehicles in the future. GM is also in the process of retooling its existing manufacturing facilities across the globe in a bid to accommodate the new low-cost platform. More recently, its Indian subsidiary announced a massive investment of $1 billion (Rs. 6400 crores) at the Talegaon plant in Maharashtra as part of the new turnaround strategy.

India will play a major role for the new small cars with the Talegaon plant used for exports
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