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General Motors to pull out of South Africa

Industry news

Port Elizabeth – In a shock announcement General Motors has stated that it intends to pull out of the South African market, however the company has managed to negotiate the sale of its local manufacturing facility to Isuzu Motors, which plans to bolster its African operations.

These moves are, however, all subject to local regulatory requirements.

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GM will cease production of the locally-built Utility as it pulls out of South Africa at the end of 2017, while Isuzu will take over the Struandale plant.

Isuzu also plans to set up its own South African dealer network.

General Motors, meanwhile intends to pull the plug on its local operations, with the Chevrolet brand set to be taken off the market by end of 2017. Not only does this mean ending production of the locally manufactured Chevrolet Utility bakkie and Spark hatchback, but imports of the Cruze, Captiva and Trailblazer will cease.

Also read: GM's SA exit - Five things you should know

As for the Opel brand, GM recently sold its German division to PSA (Peugeot-Citroen) and said that it is working with the new owner to “evaluate future opportunity for the Opel brand in South Africa.”

GM also promised that existing Chevrolet and Opel customers will continue to be supported in the market.

Isuzu remains “committed”

Following the purchase of GM’s Struandale factory in Port Elizabeth as well as its parts distribution and vehicle conversion centres, Isuzu plans to continue manufacturing the Isuzu KB as well as its medium and heavy-duty trucks in Port Elizabeth.

"We are committed to the South African market," said Isuzu’s executive officer of sales, Haruyasu Tanishige. "Integrating the South African light commercial vehicle operations into our business is the next step in laying the foundation for our growth plans in the future."

No more sunny skies for Chevrolet

General Motors meanwhile said that it will cease the manufacture and supply of Chevrolet vehicles by the end of 2017, subject to consultation with employees and unions. However, it would continue to provide existing Chevrolet customers with parts and service support.

GMSA has also promised to work closely with existing dealers on “a robust transition plan”.

Automotive News reports that GM will also cease operations in India as it aims to concentrate its investments on fewer, but more profitable, markets.

Rich local history up in smoke

General Motors was the second major car company to set up manufacturing operations in South Africa and the first locally-produced Chevrolet product rolled off the line way back in 1926. GM disinvested from South Africa in 1985, but an upper management buyout soon saw the formation of the Delta Motor Corporation, which continued to build and sell Opel, Isuzu and Suzuki products until GM reinvested in the mid-nineties, starting with a 49 percent stake in 1997 and finally buying out all of Delta's shares in 2004.

IOL Motoring

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