GM India likely to scrap ties with Reva post-M&M buy

[Bluengel180]

General Motors India on Wednesday said it may pull out of its collaboration with Reva Electric Car Co following Mahindra & Mahindra buying majority stake in the Bangalore-based firm.

GM India had last year entered into a technical tie-up with Reva to develop an electric version of its popular small car, the Spark, which was scheduled to hit the roads later this year.
"We may not continue the Spark EV programme with Reva in the light of this development and will pursue our own electric vehicle programme. An announcement to this effect will be issued soon," GM India vice-president P Balendran said here on Wednesday.

The farm equipment-to-software group Mahindra & Mahindra (M&M) on Wednesday announced acquisition of 55.2 per cent stake in Reva, as it bids to strengthen its position in the electric vehicles segment.

M&M president for automotive and farm equipment sector Pawan Goenka said GM has informed M&M and Reva about its decision to look at an alternative option for the electric Spark programme, adding it is for GM to decide as "we have no problems with GM continuing. We are quite open to it."

After joining hands in September 2009, GM India and Reva had announced that the two were looking at both domestic and overseas markets for the proposed electric small car based on the platform of the Spark and planned to turn the country into a hub for electric vehicles.

The companies had planned to roll out the electric Spark in a series of battery options and price points. The proposed version of the car was planned to have up to 90 per cent local components. Both the partners had at that time said they were open to the option of expanding the electric model to GM India's other cars also


Source : GM India likely to scrap ties with Reva post-M&M buy - NDTV Profit

[shortbread]

Unfortunate, an Electric Spark would have been an interesting proposition. Reva's electric powertrain in a proper small car rather than the plastic oddity they make.

But that said it will be foolish for Reva to loose the support of a powerhouse like M&M for an unstable GM India.

[vikrantj]

Originally Posted by shortbread

But that said it will be foolish for Reva to loose the support of a powerhouse like M&M for an unstable GM India.

I disagree, in India GM has the capability to produce better small cars than M&M. So to make a proper small electric vehicle Reva needs GM more than M&M.

--Vikrant

[Axe77]

This is really disappointing. I was really looking forward to the launch of the e - Spark. It would have been interesting to see the market reacts to an affordable (hopefully) full 4 seater electric hatch.

I wish M&M and GM could co-exist in their respective partnerships with GM but I suppose that is not to be.

[sidindica]

Mahindra takes majority share in EV builder

Indian automaker Mahindra & Mahindra says that it will take a 55.2 percent share in Bangalore’s REVA Electric Car Company, a manufacturer and designer of small city-oriented electric vehicles.
Because of Mahindra’s investment, General Motors will end its partnership with the EV maker.
REVA will be renamed Mahindra REVA Electric Vehicle Company to reflect the new ownership. Neither party released financial details on the transaction, although Mahindra says it plans to invest about $10 million into its new subsidiary.
“Our association with REVA will only help us further expand our green footprint both in India and overseas,” Mahindra & Mahindra managing director Anand Mahindra said in a statement released to the media.
The remaining major REVA shareholders will be India’s Maini Group (31 percent) and California’s AEV (11 percent).

G-Wiz
REVA is probably best known as the producer of the G-Wiz EV, a small city car initially launched in London in 2004.
The company has built about 3,500 EVs, mostly sold in Asia, Europe and South America.

REVA-GM connection
General Motors looked to REVA to build an electric powertrain for its Chevrolet Spark EV, an Indian market-only concept car that debuted earlier this year at the New Dehli auto show. That concept had been slated for production, but now a GM representative says that the automaker’s plans have been forced to change.
GM and REVA had created a pilot test fleet of Spark EVs, but the president of GM’s Indian operations says that the plans have been put on hold.
“Now we’ve stopped the test fleet as well,” GM’s Karl Slym told the AP. “We were doing it purely as something to learn. Now there’s no real benefit to that. We may as well stay with the GM solutions.”

[sgiitk]

As per the box they have done it. Say they will use their own tech!

[raghu230506]

GM ends the tie-up and would produce it's own from it's home base.

Source:

GM to develop electric car in US; ends Reva tie-up-Automobiles-Auto-News By Industry-News-The Economic Times

[theMAG]

I can empathize with GM's position - Mahindra is after all a direct rival in the Indian and other low-cost markets for GM's Chevy brand, with a car from Mahindra not too far away, I'm sure. Imagine having to supply R&D for your rival's benefit !

[shortbread]

I think the only major R&D knowledge that GM would have lost is any design related to the Spark platform, which is anyway nearly a decade old. The EV technology belonged to Reva anyways. The irony is SAIC who owns and controls half of GMI now, made a Spark rip off and succesfully sold it in the Chinese market while GM stood and watched.

M&M do not compete directly with GMI in any segment other than Tavera/Xylo and the Logan/Aveo maybe (but they are both struggling with these models.) M&M doesnt make small cars and it doesnt look like they have any in the pipeline.

The only EV GM has prepared for launch is the Volt, a car that is still to be launched and is hit by development delays. Again once ready its price will not make sense in India if and when launched. I feel by giving up on the Reva project GMI has lost an opportunity to one up its parent co. by launching a viable affordable small EV. Not only will the E-Spark have no real competition, but it also would have been a car that will make Indians take note of GM, who despite a wide model range is struggling in most segments.

[JayPrashanth]

According to a few sources whom I can't name, the electric Spark could be two years away.

Cheers,

Jay

[honeybee]

Originally Posted by shortbread

Unfortunate, an Electric Spark would have been an interesting proposition. Reva's electric powertrain in a proper small car rather than the plastic oddity they make.

But that said it will be foolish for Reva to loose the support of a powerhouse like M&M for an unstable GM India.

Plastic oddity? I beg to differ! It's actually a good material made from ABS plastic that can withstand your day to day city traffic much better. It's also very light. You would have to see the Reva to believe it can ply the city roads like anything. With two people on board, its pickup would put a Ford Icon to shame, its size would match an auto in maneuvering and it's quiet! The Reva is by no means a plastic oddity! Remember it's being exported to many countries even though it hasn't caught up yet in India.

Sorry for the OT post on the Reva.

I can't say I pity GM for losing the tie-up. After the EV fiasco in the US, it's really hard to believe any of the Detroit big three (or four or whatever) are serious about using anything other than gasoline. Reva has been going pretty strong, despite being in losses, in terms of product upgrades. It's the only company that's been able to produce an electric car commercially.

[smartcat]

There is actually a reason why GM has broken off with Reva. GM India and M&M don't see eye to eye because M&M had refused to supply diesel engines to Wuling (SAIC) commerical range of vehicles. Remember SAIC is the 50% owner of GM India.

[shortbread]

@Smartcat

Thats a new piece of info. Also M&M is eyeing Ssangyong which was bought by SAIC. Now the Korean govt. has sued this chinese co. and looking to sell SY to more legitimate organizations like M&M . This must've pissed of SAIC as well, hmmmm...chinkies playing politics already I guess.

@Honeybee

What I meant by plastic oddity was that the it wasnt what we relate to a car as such, the Spark on the other hand would be a lot more conventional and thus desirable.

[honeybee]

Originally Posted by shortbread

@Honeybee

What I meant by plastic oddity was that the it wasnt what we relate to a car as such, the Spark on the other hand would be a lot more conventional and thus desirable.

The Spark with all its other parts is going to add a huge amount of weight to lug around, as compared to the Reva. An electric vehicle designed on the lines of a traditional automobile will be even more restricted than a clean and new design like the Reva.

Regarding the GM - Reva link, as soon as M&M bought a majority stake, it was only a matter of time before the GM went out of the picture. Even without the two episodes mentioned earlier, I doubt if M&M would be generous enough to share a technology with a potential competitor after having invested a few crores to get it for their own use. I think this could be one reason why M&M bought a majority stake in Reva instead of going for a technology tie up as in case of GM. Now M&M would be able to utilize all the technology and know-how of Reva for only Reva and M&M. A mere technology sharing would mean the same technology would also go to GM (or any other carmaker that came along with a technology tie up). Exclusive access to Reva and its tech will take M&M to new heights much faster.

Don't forget GM and many other carmakers may not be financially in a position to spend money on long research into launching a production-ready electric vehicle.

[avishar]

GM india had been already showcasing the spark for a long time and i guess developed would have already reached advanced stages.At this point are they canning the project or bring it out alone?