The commercial agreement was signed on Wednesday morning in National Capital Region.
16 Aug 2023 | 11712 Views | By Ketan Thakkar
Having exited the Indian car market almost 6 years ago, General Motors has finally exited the world's third largest car market by signing the commercial agreement with South Korean car maker to sell its Talegaon plant assets.
The commercial agreement was signed on Wednesday morning in National Capital Region.
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Having exited the Indian car market almost 6 years ago, General Motors has finally exited the world's third largest car market by signing the commercial agreement with South Korean car maker to sell its Talegaon plant assets.
The commercial agreement was signed on Wednesday morning in National Capital Region.
Autocar Professional had exclusively reported a week ago on a potential conclusion of sale in August.
Unsoo Kim, Managing Director and CEO of Hyundai Motor India Ltd., and Asifhusen Khatri, Vice President Manufacturing of General Motors India and General Motors International Operations, participated in the signing ceremony in Gurugram, Haryana.
In an official release, Hyundai Motor India said the company has signed an ‘Asset Purchase Agreement’ for the acquisition of identified assets at GM India Talegaon Plant.
The Asset Purchase Agreement (APA) covers the assignment of land and buildings and the acquisition of identified assets at General Motors India’s Talegaon Plant. Manufacturing operations at the plant are planned to commence in 2025, augmenting Hyundai Motor India’s manufacturing footprint.
"As part of Hyundai’s resolute commitment to the Indian automotive industry, with the Sriperumbudur (Chennai) and Talegaon plants, Hyundai Motor India aims to cumulatively achieve a production capacity of 1 million units a year. Leveraging the expanded capacity, HMIL will review plans to launch additional electric vehicle models into the Indian market, manufactured at its Sriperumbudur plant, thus accelerating India’s electrification goals," the company said in a statement.
Leveraging the expanded capacity, HMIL will review plans to launch additional electric vehicle models into the Indian market, manufactured at its Sriperumbudur plant, thus accelerating India’s electrification goals, the South Korean car maker added.
The APA covers the acquisition and assignment of land and buildings as well as certain machinery and manufacturing equipment situated at GMI’s Talegaon plant. The completion of the acquisition and assignment is subject to fulfilment of certain conditions precedent and receipt of regulatory approvals from relevant government authorities and relevant stakeholders, the company clarified.
Unsoo Kim, Managing Director and CEO, Hyundai Motor India Ltd. said, "This year is a significant milestone for Hyundai Motor India, as we celebrate 27 years of activity in the market. Demonstrating our dedication to India, earlier this year, HMIL entered into a Memorandum of Understanding (MoU) to invest Rs 20,000 crore in Tamil Nadu for expanding capacity and establishing an electric vehicle ecosystem. As we reinforce our commitment to ‘Atmanirbhar Bharat’ (Self-Reliant India), we intend to create an advanced manufacturing center for cars Made-in-India in Talegaon, Maharashtra. Our manufacturing operations are scheduled to begin in Talegaon, Maharashtra, in 2025."
Just last week - the state government's two key ministers, Labour Minister Suresh Khade and Industries Minister Uday Samant confirmed that the state is doing everything possible to resolve the differences with the former GM workforce, which has become an impediment in the transfer of GM's Talegaon plant to Hyundai Motors India.
Hyundai Motor is likely to invest over Rs 5000 crore in the factory over the coming decade.
The Industries Minister, who recently visited Hyundai's Goyang Studio facility in South Korea with Industry Secretary Dr. Harshdeep Kamble and MIDC CEO Vipin Sharma, stated that the State government is looking forward to both parties (General Motors and Hyundai Motors India) signing a commercial agreement for Hyundai to begin manufacturing operations in the state.
"We expect the Hyundai project to employ 4500 unemployed and underemployed youth in the state," Uday Samant said.
GMI’s Talegaon plant currently has an annual production capacity of 130,000 units. Upon completion of the agreement, HMIL plans to expand its annual production capacity to achieve its strategic goal in the market. Since HMIL already has enhanced its production capacity from 750,000 units to 820,000 units in the first half of this year, the capacity augmentation of the GMI plant will lay the foundation for HMIL to produce around 1 million units a year.