The global auto giant, General Motors, plans to invest $1 billion in India in the next few years to make the country its new global export hub, top executives of the company revealed.
"GM cannot remain a global leader without making a serious investment towards expanding our presence in growth markets like India," GM chief executive officer Mary Barra, told The Economic Times.
GM's India plans are a part of the company's overall $5 billion investment earmarked towards the development of "a global family of Chevrolet vehicles" over the next few years, by partnering with Chinese automaker Shanghai Automotive Industry Corp (SAIC).
In the past few years, the domestic automobile market has been witnessing sales of less than three million cars annually due to slowing demand. However, India is projected to emerge as the world's third-largest passenger vehicle market by 2020, next to China and the US.
The company will roll out 10 new locally-manufactured vehicles in India over the next five years, as it plans to double its market share in the country by 2020, said Stefan Jacoby, GM's chief of international operations.
GM occupied a market share of 1.8 percent by the end of 2014, selling 56,700 vehicles in the country.
With Japanese and Korean automakers having a significant presence in the Indian automobile market, Western companies like GM, Ford Motor Co and Volkswagen AG are facing difficulties to improve their sales.
"With this investment, we plan to tap India's potential as a market and as a low-cost manufacturing base for the future," Jacoby told Reuters.
By making India as its export hub, GM also likely wants to ease some pressure on its operations in South Korea. South Korea has been its export hub for long, accounting for one-fifth of the automaker's global output.
"However, the Indian expansion doesn't herald a gradual move away from GM's use of South Korea as an export base," Jacoby said.