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Old 4th November 2015, 18:57   #1
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Default General Motors loses nearly 60 dealerships in India

General Motors (GM) has not been doing very well in India. The third-largest carmaker in the world has been having trouble selling its vehicles in the country. This has resulted in many of its dealers surrendering their dealerships.

General Motors loses nearly 60 dealerships in India-enjoy-anniversary-edition.jpg

A few months ago, GM had more than 280 dealerships in India. Today, this number has come down to 223. In the period April-September 2015, a total of 19,299 GM cars were sold. This number is about 33% lesser than the number of cars sold in the same period in 2014. This also means, that each outlet has sold approximately 87 cars in the six months. With each dealership selling just 15 cars per month on average, dealers are considering it unviable to continue.

While some have decided to cut off ties with the American auto major completely, others are reducing the number of outlets.

However, GM says that is not expanding its dealership network because it wants to make operations of existing dealerships viable. The company claims that it has increased the dealer margins to industry-best standards.

At present, GM has 223 sales outlets and 253 service stations in India, which it believes is vast enough. The company is expected to invest 10 new models in the next five years. It has also stopped production at its Halol plant. All cars are now manufactured at the Talegaon plant. GM also plans to export one third of the cars it produces in India.

Related news: Nissan losing dealerships in Mumbai (Kamla Nissan (Mumbai) no longer a Nissan dealer. EDIT: Torrent Nissan too)

Source: ET Auto

Last edited by Aditya : 4th November 2015 at 18:58.
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Old 4th November 2015, 20:14   #2
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Default Re: General Motors loses nearly 60 dealerships in India

What's surprising is GM's casual attitude! They seem to have no regrets and are quite happy that their dealers are giving up on them. GM might be the most stupid or ignorant car maker in India.
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Old 5th November 2015, 10:13   #3
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Default Re: General Motors loses nearly 60 dealerships in India

I am sure they are not stupid alone...they are just adjusting their dealership in proportion to their manufacturing facilities !

Since Halol has closed down so should be 50% of dealership. Is someone serious about Chevy in India or they have decided to pull curtains !

Harakiri !
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Old 5th November 2015, 10:30   #4
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Default Re: General Motors loses nearly 60 dealerships in India

As an ex-owner of the erstwhile Opel Astra which sold under the GM umbrella, it makes me sad about seriousness shown by GM in India. Best described as "complete ignorance" by GM India about the Indian market. Right from the Opel days to the present Chevrolet days, they have not had much success in India leave aside a couple of cars here and there. GM was one of the first manufacturers to set their foot in a liberalized India in the early 1990's and yet didn't learn from their mistakes. I have seen so many dealerships and service centres closed/or switched to other manufacturers in and around Bombay(especially in the suburbs) during the past decade.

I sincerely hope GM to pull up its socks and bring in some cost effective fresh car models in India. Since they have some expertise in diesel engines they can look at targeting diesel cars, as India is a predominantly diesel obsessed market. For example a crossover SUV like the Chevy Trax has the potential to shake up the segment.
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Old 5th November 2015, 10:31   #5
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Default Re: General Motors loses nearly 60 dealerships in India

Quote:
Originally Posted by Doge View Post
What's surprising is GM's casual attitude! They seem to have no regrets and are quite happy that their dealers are giving up on them. GM might be the most stupid or ignorant car maker in India.
Looks like they have finally realized that their current offerings doesn't stand a chance in the present Indian market. Even the future prospects look too bleak for them here considering :

Trailblazer : CBU pricing, no 4 x 4 , Fortuner, Endeavor, Pajero

Spin MPV & CUV : Absolutely no USP over even the facelifted Ertiga. The Lodgy had a better chance here but looks like even it has failed. Add the Ecosport and TUV300 to the equation and we can clearly see where these are going.

New Beat : Will be a disaster unless they manage to demote it to the A Segment and price it accordingly. This I highly doubt.

Sonic twins: Who would buy them now when the market has the Baleno, Figo and Jazz in the lower spectrum and the Polo GT and Abarth Punto on top. The sedan version would easily succumb to the the City & Ciaz duo.

GM has lost 4 dealers in Kolkata itself. Yet the lone remaining dealer's sales figures, as reported by a known SA, are abysmal.
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Old 5th November 2015, 10:31   #6
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Default Re: General Motors loses nearly 60 dealerships in India

The volume of business that GM does in india is fractional as compared to volume done elsewhere . Actually i would go to an extent that they are not much interested in the Indian maket besides having a DOT on the map that they have a presence here. They have wonderful products abroad but are hardly bringing anything new here. How long can you sell your BEAT Diesel and the Same old Chevy Cruze.

I had passed by from Andheri-Mumbai Showroom of GM yesterday. It was empty and had a big banner outside "Available for Lease". Almost all car showrooms are there in the vicinity of Andheri veera desai area within 1 KM Radius. Skoda, Hyundai, Honda, Maruti, NEXA, Renault, VW, Audi to name a few. If someone wants to sell a car in the western suburb they need to be here. Absent players are GM and FIAT.
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Old 5th November 2015, 10:35   #7
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Default Re: General Motors loses nearly 60 dealerships in India

Sucks, but such is the nature of the beast. An authorised dealership can make a lot of money with the right brand. But it is a very capital-intensive business. Land & inventory costs can wipe out your balance sheet.

This situation isn't exclusive to GM. Other weak brands (including Nissan & Skoda) have also lost a lot of dealerships as it was simply unsustainable.

See, from the POV of the dealership, it costs the same money to run a franchise of a flop or successful brand. If they manage to tie up with a more powerful manufacturer, why shouldn't they jump ship?

Quote:
Originally Posted by Doge View Post
They seem to have no regrets and are quite happy that their dealers are giving up on them.
Don't give it too much importance; that was just a face-saving statement.

Quote:
Originally Posted by i74js View Post
Is someone serious about Chevy in India or they have decided to pull curtains !
General Motors has recently committed to investing $1 billion / Rs. 6500 crores in India. They aren't giving up just yet, but it sure is going to be an uphill task.
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Old 5th November 2015, 11:39   #8
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Default Re: General Motors loses nearly 60 dealerships in India

I am in the market for a new car. I was looking forward to a test drive of Chevy Beat petrol. I had found a dealer in Jayanagar in Bangalore which is on the way from my office to my house. But I found it closed on several occasions when I went after office hours.

Initially thought that they close early, so was waiting for a good free weekend for the TD. Few weeks back , I found a TO-LET board hanging on the showroom with no traces of it being a Car Showroom !

Last edited by GTO : 6th November 2015 at 14:27. Reason: Typo
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Old 5th November 2015, 11:44   #9
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Default Re: General Motors loses nearly 60 dealerships in India

Thats a free market for you. Players can enter or exit the market as they please.

GM's brand value is going down the toilet. Sales are in a free fall. There does not seem to be a viable product pipeline. The Halol plant - their original one in India - is shut. Strategy seems non-existent. It is no wonder that dealers are voting with their feet.

I think, whoever in GM is heading the dealer management department ought to read this: http://www.autocar.co.uk/blogs/new-c...s-are-new-used
Might be the only way a GM dealer could survive!!
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Old 5th November 2015, 12:03   #10
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Default Re: General Motors loses nearly 60 dealerships in India

Well, this is more or less expceted.
Many reasons for this but to summarily put it, it boils down to just two:

1) Poor choice of products and poor after sales
2) Absolute disconnected sales team and marketing efforts.

Just for the heck of it, I had gone to a GM outlet in Navi Mumbai.
They efforts to make me comfortable was non existent.
Moreover, though the showroom was empty, there was no one to attend me for almost 15 mins.

If that is the attitude, customers will turn away. Who cares for a non entity brand now?

There is no clinching feature in any of their cars as well that can differentiate a GM with competition nor is there any looker in the lineup(The Cruze once was a handsome car though, not anymore!!)
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Old 5th November 2015, 12:19   #11
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Default Re: General Motors loses nearly 60 dealerships in India

Nothing surprising here. Dealers just can't make anymore losses by doing business for a losing company. No future as well. I am sure many of these dealers will turn to other car manufacturers for the dealerships. I can see many opting for Nexa now
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Old 5th November 2015, 12:43   #12
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Default Re: General Motors loses nearly 60 dealerships in India

If a car maker does not sell enough vehicles for a dealer to justify the cost of setting up an exclusive showroom and service facilities, then the only option for both dealer and manufacturer is to have a multi-brand outlet. This is common abroad for both cars and bikes, particularly in areas where sales are not expected to high enough to justify a single brand to setup but the expected combined sales of several brands will be profitable.

Going by this scenario, GM, Fiat, Nissan, Datsun and maybe even Renault, if the Kwid somehow flops, would all have to consider allowing this type of retailing. At the very least, they should allow exclusive showrooms with common service centres.

India is a medium sized market at the moment, in both value and volume, but the growth potential is high. The only way to survive in this environment is by investing big and investing for the long run. GM doesn't look like they are capable or interested in doing either. Fiat also don't seem to care - doing well in India requires India-specific products which they don't have. Nissan doesn't care since almost everything they make in India is exported. Renault has brought the Kwid and I really hope Renault does what is required for the Kwid to do well. As an Indian consumer, I hope that the Kwid's success will encourage others also to bring innovative products.
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Old 5th November 2015, 13:04   #13
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Default Re: General Motors loses nearly 60 dealerships in India

GM hasn't launched a desirable product in India after the Cruze- which was powerful and well priced. Leaving reliability and quality perceptions, why would anyone choose the SAIL junk that the company is trying to peddle today over any of the better looking and better supported products in the market.

The new ads saying "I care" should be replaced with something more appropriate, we're GM we don't care, how do you think our dealers fare? GM India is a subsidiary type operation of SAIL, the awful lineup for the mass market along with a dead on arrival import means it's a miracle that only 60 dealers left instead of the same number remaining in operation.
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Old 5th November 2015, 14:44   #14
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Default Re: General Motors loses nearly 60 dealerships in India

With the exception of Cruze; now that Tavera has half a dozen competitors, I wonder if any GM car is a first-choice for anyone.

It's amusing: looking at someone like Hyundai on one hand and GM on the other.
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Old 5th November 2015, 15:16   #15
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Default Re: General Motors loses nearly 60 dealerships in India

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Originally Posted by libranof1987 View Post
now that Tavera has half a dozen competitors, I wonder if any GM car is a first-choice for anyone.
I had been to Srinagar on vacation and was surprised to find Tavera out-numbering its competition by 4:1! I got into conversation with the driver and he said that Tavera has huge demand and taxi drivers prefer to buy Tavera even today over other competition. Compared to Innova, I did find Tavera to be as spacious if not more. I never felt like a vehicle from another era.

I believe GM can sell decent number under Chevrolet brand. Spark and Beat are pretty competent. It beats me as to why they are so lethargic.
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