Karl Slym, President & MD, GM India has spent close to three years in the Indian market. The times have changed him considerably, more with respect to his understanding of the Indian customer. Slym shares with B&E the decisions taken in the hard times and the strategy forward with GM’s Chinese JV Partner.
B&E: You have a good experience of working in the JV environment in the past as well but as far as the Indian market is concerned, we have seen many JVs not working in the past. What makes you so sure of the fact that the partnership with SAIC will go a long way?
Slym: I think that JVs are something that you have to embrace. Where there are no synergies and both are not seeing any potential benefits together, there is a problem. But if the planning upfront is right where both parties are seeking their own set of benefits and are able to make something better, which was not possible individually; you have a strong foundation on your side to start with. It is not a single point focus, but if it is done carefully, one may look at the benefits, which are huge in magnitude. Moreover, as we have already seen a lot of success with the partner in China, we are trying to ensure that we are able to replicate that success in the Indian market as well.
B&E: But you have had a bitter experience on the same with your partnership with Reva. What about your plans for the electric car market?
Slym: After the deal with Reva didn’t go through, we decided to go ahead alone in the electric car segment. We will show you an electric car in the first half of next year, which will be a small car.
B&E: You mentioned in our last interaction about your plans for the LCV market for end 2012. What is the latest update on the same?
Slym: We are now planning to roll out the LCVs much before that. It will still be in 2012, but it will be done at the 11th Auto Expo. We will roll out close to six products in total with 15 fuel variants in the next 24 months. We have a design centre here but at the moment, they don’t have a proper architecture, which is a vision for them to grow to. The way we work therefore is that we have global products wherein, let’s say, we pick up a Cruze from Germany and then we put it through our Indian R&D Centre. The centre makes sure that the ground clearance, suspension, horn and similar things are adjusted according to Indian conditions. We will follow a similar process for the vehicles from China. Needless to mention, we are aiming for a very high level of localisation that will be close to a level of 90%. Therefore, we are now signing up with new suppliers for the plans for the LCV market.
B&E: As you have decided to brand it under the Chevrolet umbrella, what makes you come to a conclusion that you will require a new infrastructure to sell commercial vehicles in India?
Slym: As everybody knows Chevrolet today, more and more people are accepting it as one of the most promising brands as well. A lot of energy and effort has gone into establishing the Chevrolet brand after we started with GM moving on to Opel and then finally landing right with Chevrolet. Moreover, when you know you are going to compete against a brand as strong as Tata, you don’t really want to take any chances with a brand which is completely new to the Indian consumer. By the time we launch, we could have reached new heights in terms of consumer confidence and there will be close to half a million Chevrolet cars on the Indian roads. For the different infrastructure, there are two entirely different sets of consumers that we are trying to address here with passenger cars and LCVs. And as both environments are very different from each other, it makes a lot of sense for us to have a separate infrastructure for them too. We have a possibility of sharing a back office for that but the final point of sale will be different from passenger cars.
B&E: You have a good experience of working in the JV environment in the past as well but as far as the Indian market is concerned, we have seen many JVs not working in the past. What makes you so sure of the fact that the partnership with SAIC will go a long way?
Slym: I think that JVs are something that you have to embrace. Where there are no synergies and both are not seeing any potential benefits together, there is a problem. But if the planning upfront is right where both parties are seeking their own set of benefits and are able to make something better, which was not possible individually; you have a strong foundation on your side to start with. It is not a single point focus, but if it is done carefully, one may look at the benefits, which are huge in magnitude. Moreover, as we have already seen a lot of success with the partner in China, we are trying to ensure that we are able to replicate that success in the Indian market as well.
B&E: But you have had a bitter experience on the same with your partnership with Reva. What about your plans for the electric car market?
Slym: After the deal with Reva didn’t go through, we decided to go ahead alone in the electric car segment. We will show you an electric car in the first half of next year, which will be a small car.
B&E: You mentioned in our last interaction about your plans for the LCV market for end 2012. What is the latest update on the same?
Slym: We are now planning to roll out the LCVs much before that. It will still be in 2012, but it will be done at the 11th Auto Expo. We will roll out close to six products in total with 15 fuel variants in the next 24 months. We have a design centre here but at the moment, they don’t have a proper architecture, which is a vision for them to grow to. The way we work therefore is that we have global products wherein, let’s say, we pick up a Cruze from Germany and then we put it through our Indian R&D Centre. The centre makes sure that the ground clearance, suspension, horn and similar things are adjusted according to Indian conditions. We will follow a similar process for the vehicles from China. Needless to mention, we are aiming for a very high level of localisation that will be close to a level of 90%. Therefore, we are now signing up with new suppliers for the plans for the LCV market.
B&E: As you have decided to brand it under the Chevrolet umbrella, what makes you come to a conclusion that you will require a new infrastructure to sell commercial vehicles in India?
Slym: As everybody knows Chevrolet today, more and more people are accepting it as one of the most promising brands as well. A lot of energy and effort has gone into establishing the Chevrolet brand after we started with GM moving on to Opel and then finally landing right with Chevrolet. Moreover, when you know you are going to compete against a brand as strong as Tata, you don’t really want to take any chances with a brand which is completely new to the Indian consumer. By the time we launch, we could have reached new heights in terms of consumer confidence and there will be close to half a million Chevrolet cars on the Indian roads. For the different infrastructure, there are two entirely different sets of consumers that we are trying to address here with passenger cars and LCVs. And as both environments are very different from each other, it makes a lot of sense for us to have a separate infrastructure for them too. We have a possibility of sharing a back office for that but the final point of sale will be different from passenger cars.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles
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