MG Motor To Take Over Chevrolets Halol Plant In Gujarat

Soon after announcing their entry into the Indian auto industry, MG Motor's parent company, SAIC Motor, has signed a memorandum of understanding with the Gujarat government. According to the MoU, SAIC will invest Rs 2,000 crore to start production of cars under the British brand, which is set to commence sales in 2019. Another Rs 1,000 crore of cumulative investment is expected to come from SAIC's partner manufacturers and suppliers such as Yanfeng Automotive Interiors, Huichoung, Wuling Industry and LingYun Industrial Co.

MG and its suppliers want to make Gujarat their manufacturing hub to facilitate easier exports using the state's harbours. Having major suppliers and the assembly plant in close quarters enables faster production and lower shipping costs. But the company is open to considering offers from other state governments.

P Balendran, executive director of MG Motor India, said, "We are going to develop products for Asian markets with our key focus on India. We have seen big multinational brands fail when they try to run their Indian operations from their overseas headquarters. With this in mind, our strategy will be very much India specific and all key decisions will be taken here. We are in talks with various state governments but our preferred destination is Gujarat."

General Motors had leased the Halol plant from Gujarat Industrial Development Corporation to make cars for local and export markets. SAIC and MG Motor are interested in taking over the facility before commencing production, as promised while declaring their entry in India.

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