General Motors Exits India While Ford Expands

General Motors executives say they decided to end sales in India because they no longer saw a path to decent profits. But their pessimism about the world’s second-most-populous country is more a product of GM’s own missteps in India over more than two decades than the market’s prospects.

Indeed, plenty of other global automakers Hyundai Motor, Suzuki Motor, Honda Motor and Toyota Motor, to name a few have done a better job reading the market and offering vehicles that match consumers’ needs and desires. Ford Motor Co. has more than double the market share of GM. Even Fiat Chrysler Automobiles has found a way to sell Jeep.

GM’s performance in India, which IHS expects to become the fourth-largest vehicle market next year, had gone from mediocre to worse lately. Its market share fell from 4 percent in 2011 to less than 1 percent last year. In 2015, it proposed a $1 billion investment to help reverse its declining fortunes, but CEO Mary Barra and President Dan Ammann, who have been abandoning parts of the globe where big returns aren’t on the horizon, ultimately decided GM had worked itself into such a disadvantage that India’s potential was no longer worth chasing.

GM’s retreat from India contrasts with the aggressive approach of its Japanese rivals, which are counting on India for long-term growth and piling in with investments.

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