Thursday, January 17, 2008

Premium SUV Market Is Booming in India

General Motors India (GMI), the Indian arm of the US automobile manufacturer, has entered the premium SUV segment, by launching Chevrolet Captiva this week, its new sports utility vehicle for the Indian market.

The Chevrolet Captiva (pictured above) is priced to compete with Honda CR-V -which is sold at Rs 18.4 lakh ($47,000), Pajero - priced at 18.8 lakh ($48,000)and Nissan X-Trails - it's priced at Rs 23 lakh ($58,000). The 2-litre diesel driven Captiva will be available to the customers for Rs 17.74 lakh (about $45,000).


Following the launch of the $2,500 Tata Nano in India earlier this week, the introduction of the Chevy Captiva in India suggests that both the low-end and high-end vehicle markets are profitable and thriving in India's booming, red-hot economy.

This is the other side of outsourcing and globalization that Lou Dobbs, John Kerry and John Edwards seem oblivious to. Who is buying $50,000 Chevy SUVs in India? Perhaps it's a manager or executive at Bangalore-based Infosys or Wipro, who got promoted and received bonuses based on providing BPO services to a U.S. corporation, and now can afford to buy a $50,000 vehicle from GM?


4 Comments:

At 1/17/2008 4:19 PM, Anonymous Anonymous said...

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This is the other side of outsourcing and globalization where an Indian company (GM India) borne out of an American company (GM) can outsource the manufacture of an automobile to a Korean company (Daewoo) that was designed and developed in Italy by VM Motori a company owned by Roger Penske and then sell it in India as an "American" SUV.

 
At 1/17/2008 5:09 PM, Anonymous Lee said...

As American as apple pie.

Did you know that China is the world's leading producer of apple juice?

 
At 1/17/2008 7:36 PM, OpenID sethstorm said...


This is the other side of outsourcing and globalization that Lou Dobbs, John Kerry and John Edwards seem oblivious to. Who is buying $50,000 Chevy SUVs in India? Perhaps it's a manager or executive at Bangalore-based Infosys or Wipro, who got promoted and received bonuses based on providing BPO services to a U.S. corporation, and now can afford to buy a $50,000 vehicle from GM?

They are right for saying that - given that it is viewed as blood money. When jobs leave, and the method for getting up is made closer to impossible, it is indeed "blood money" that comes from such lines of business.
Start at home, and have those divisions fuel the original Detroit division. This could then afford GM more room to make the large cars(in the US/Canada, with unions) that are still quite desired, and in a more affordable package. This package would also have the quality that belies the US/UAW stereotype that's been inaccurate for years.

Edwards at least was able to claw some of it back with no shame. Dobbs at least doesn't hide the problem, but provides a very good explanation where the (politically inclined) economists leave off.

The only way it might see some good is that if it gave plenty of room for unions keep on running in the US, and to have something more than an I4 econobox at $15-20k USD.

There is some (limited) enthusiasm about it, but the general enthusiasm is contained within Wall Street. When Detroit's workers (unionized and not) see some progress they like, then it will be on better terms. Until then, expect a gradual and permanent exit of all the things of the Reagan era(that started this all).

 
At 1/17/2008 11:20 PM, Anonymous Anonymous said...

Here's a true story. The last time I bought a luxury SUV was in 1999. I was a programmer/analyst with a lucrative consulting business. After 2000 the US programming market was flooded with H1-B visa programmers from India. They work for 1/3 of what I was making. Long story short, I haven't bought a car since. Another globalization success story!

 

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