GM plans entry level car

10 November 2008

New Delhi: While Maruti 800 is believed to be on its way to being phased out due to its falling sales, the biggest car company in the world General Motors is upbeat about the prospects of entry-level cars.

General Motors is focusing on entry-level cars and plans to introduce two new cars next year. These include a premium level Chevrolet Cruze sedan as well as a new compact car priced below the Spark model and hence close to Maruti's M800 model in price.

Despite the slowdown in the automotive sector, the company has decided not to postpone its planned investments for India. Recently the company began production at its second Indian plant at Talegaon in Maharashtra. The company also plans to go ahead with an additional $210 million investment for a powertrain facility (engine, gearbox and transmission) at the same location.

Company's officials said GM's sales in India have been on the rise, especially after the launch of the compact Spark, its cheapest offering at a price of Rs2.66 lakh.

GM is focusing on the new compact car that it plans to roll out from Talegaon. Sources said the car would be positioned below Spark making it one of the closest rivals to Maruti800, the cheapest car in India so far that costs Rs 2 lakh. Production of the car is said to have begun at Talegaon.

Company officials said the new compact is part of a global model of GM and would be tuned for Indian market conditions.