Cars after smartphones? Chinese auto major to debut in India

SAIC Motor, the automotive design and manufacturing company from Shanghai, could soon be making its debut in India. The Fortune Global 100 Company has already started hiring key executives, people aware of the development told ET. The list of people hired includes Rajeev Chhaba, a former India head of General Motors, who will be taking the CEO position.

The vehicles would be sold in India by MG Motor India, SAIC’s local unit, with an MG tag.

SAIC will be acquiring General Motors' factory at Halol in Gujarat and has already obtained Competition Commission of India's approval for the same.

Also read: Half a dozen international car makers are hoping to enter the Indian market. Here’s why

However, there are some unsettled labour issues at the General Motors’ plant, which could prove to be a roadblock for SAIC. If the issues get resolved by the middle of next month, it would take over the plant as early as in April. This could mean that the first vehicle would be ready to be rolled out from the plant late next year or early 2019.

If in case, the issue doesn’t get resolved soon, a new facility would be built for the company’s India operations.

Also read: Here’s how young India is buying cars

Even though it’s true that Chinese products sell like hot cakes in the Indian market, buyers are apprehensive when it comes to motors, maybe because of quality concerns, say experts.

However, once they convince consumers about quality, the low cost of Chinese products would play a huge role in their success in the cost-conscious Indian market, even posing a challenge to established players like Maruti Suzuki.

As per reports, SAIC has hired KPMG to study the Indian market, while PwC was hired to study the cost of the GM plant. Other than these two players, EY was also hired to assist in finalising suppliers.

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