General Motors India, Fiat India to synergise engine sourcing

Our Corporate Bureau
17 January 2003

Chennai: General Motors India and Fiat India are planning to synergise their logistics and component sourcing to derive economies of scale and cut costs. The two global automakers are planning to synergise their operations in these areas at a global scale.

“We are looking at synergising engine purchase and other supplier network,“ says P Balendran, vice-president (corporate affairs). Fiat India has a massive engine manufacturing capacity while the capacity utilisation is small. Though the company claims to have localised components to the extent of 70 per cent it imports engines from Germany.

General Motors Corporation holds a 20-per cent stake in Fiat SpA, Italy, and Suzuki Motors Corporation, Japan. It recently bought the Korean auto company Daewoo Motors and a new company, GM-DAT, has been formed to sell Daewoo products.

The American company also has strong technology collaborations with Japanese companies Toyota Motor Corporation and Isuzu Motors. GM-DAT has been formed after General Motors Corporation took over Daewoo Motors, Korea.

Globally there is a move towards having commonality of parts to cut costs. According to Balendran, currently there is no move towards having cooperation with Suzuki Motors and Daewoo Motors in India.

To cash on the existing market trend, General Motors India is planning to launch a multi-utility vehicle. The company intends to source engines from Hindustan Motors for that vehicle.