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MG Motor inaugurates manufacturing facility at Halol

UK-based carmaker MG (Morris Garages) Motor on Friday announced the inauguration of its first manufacturing facility in India with a minimum investment of Rs 2,000 crore. The company would operate from the Halol plant in Gujarat, overtaken from General Motors (GM) recently.

MG Motor India would roll-out its first car from the plant in 2019 and have an initial capacity of 80,000 units per annum in the first phase.

A subsidiary of General Motors’ Chinese joint venture partner, SAIC Motor Corporation Ltd, MG Motors India had earlier signed a deal with the Gujarat government and GM India for transfer of lease of the Halol land. With this, the $100-billion SAIC would become the first Chinese auto major to have a dedicated manufacturing base in India.

SAIC had acquired the iconic British racing car brand, MG, in 2008.

Spread over an area of 170 acres, the Halol facility would be completely revamped by MG Motor over the next two years. Already, an initial workforce of 70 employees has been hired by MG Motor India.

Terming it as a “water-shed moment” for the company in India, Rajeev Chaba, president and managing director, MG Motor India, said that the aim was to contribute to the ecosystem in Gujarat by generating employment opportunities for local talent as well as leveraging the supplier base.

“The Morris Garages brand already has a huge resonance in India, with at least 500 owners in India since 1924, when the brand was first established in the UK. These owners and many passionate fans have expressed their curiosity, keenly anticipating the brand’s return to India,” Chaba said.

Around five global vendors of the company, too, are likely to set up their manufacturing base in Halol, and this is likely to entail an investment of another Rs 1,000 crore or so. These investments could generate employment for around 1,000 people.

MG Motors would not be the only new car brand to hit the Indian roads in 2019. Kia, a subsidiary of Korean auto major Hyundai, also plans to start rolling out cars from its upcoming Rs 7,000 crore manufacturing plant in Andhra Pradesh, being set up to produce 300,000 units a year.

Global players are betting big on the Indian market, which is amongst the fastest growing markets and is poised to emerge as the third bigger car market from the third position now. A total of about three million passenger vehicles (cars, utility vehicles and sedans) are sold in the domestic market annually while about 700,000 units are exported.

(Report: Business-standard)

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Alstom India changes name to GE Power India

GE announced today that it has completed the acquisition of Alstom’s power and grid businesses. The completion of the transaction follows the regulatory approval of the deal in over 20 countries and regions including the EU, U.S., China, India, Japan and Brazil. It is GE’s largest-ever industrial acquisition.

GE reached an agreement with Alstom in 2014 to purchase Alstom’s power and grid businesses for €12.35 billion.  Adjusting for the joint ventures announced in June 2014 (renewables, grid, and nuclear), changes in the deal structure, price adjustments for remedies, net cash at close, and including the effects of currency, the purchase price is €9.7B (approximately $10.6B). This includes working capital usage of approximately €0.6B in the month of October.  GE expects the deal to generate $0.05-0.08 of earnings per share in 2016 and $0.15-0.20 of earnings per share by 2018.  GE is targeting $3.0 billion in cost synergies in year five and strong deal returns.  The overall economics and strategic rationale remain the same as GE announced in April 2014.

“The completion of the Alstom power and grid acquisition is another significant step in GE’s transformation,” said Jeff Immelt, chairman and CEO, GE. “The complementary technology, global capability, installed base, and talent of Alstom will further our core industrial growth. We are open for business and ready to deliver one of the most comprehensive technology offerings in the energy sector for our customers.”

Customers will realize immediate benefit from the combination of GE and Alstom, including these current projects:

  • PSEG Sewaren (New Jersey combined cycle power plant): GE 7HA gas turbine + Alstom heat recovery steam generator (HRSG)
  • Punjab Pakistan Bhikki (Pakistan combined cycle power plant): two GE 9HA gas turbines + Alstom steam turbine
  • Exelon Power Plants (Texas power projects): four GE 7HA  gas turbines + four Alstom HRSGs
  • Chempark (Leverkusen, Germany combined heat and power project):  GE 9HA gas turbine.

In addition, GE and Alstom are both preferred bidders for a combined cycle plant project in Asia that would use two GE 7HA gas turbines, two Alstom HRSGs and one Alstom steam generator, and Alstom is the preferred bidder for Arabelle steam turbines in two UK nuclear reactors; the preferred bidder for boilers, steam turbines and generators a clean coal project in the Middle East; and has successfully delivered India’s first 800 kV High Voltage Direct Current (HVDC) power transformer for the Champa-Kurukshetra project.

GE also announced today it has completed the sale of its rail signaling business to Alstom for approximately $800 million.

GE continues to execute its strategy to become a simpler, more focused company. In addition to the Alstom acquisition, the split-off of Synchrony Financial has commenced; the GE Capital exit strategy is ahead of plan, with $126 billion of signed dispositions; the recent formation of GE Digital is consolidating all digital capabilities across the company to provide customers with the best industrial solutions and software; and GE is winning in the marketplace and delivering strong financial results.

Reference: GE News Room

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SAIC signs formal agreement to buy GM’S plant in Halol

China’s largest automaker SAIC has signed the long-deliberated deal with General Motors to buy the latter’s plant in Halol in Gujarat, according to a filing in the Shanghai Stock Exchange (SSE) on Wednesday. The filing did not reveal any further details about the agreement.

While the decision of shutting down the Halol plant was echoed by the American automaker in July 2015, the Shanghai Automotive Industry Cooperation stepped in in January 2017.

The Chinese buyout is a step in the direction of increasing its automotive footprint in India and at the same time giving a hand to the American automaker that recently said that it might make a formal announcement of stopping its Indian operations starting May, which could mean a decision to wind down its presence in the country might be in the offing.

SAIC has plans to reportedly invest $1 billion in India as part of its strategy along many others to enter the Indian market which is set to be the third largest in the world by the end of this decade.

General Motors, on the other hand is looking at withdrawing from the Indian market due to thinning of sales. GM India has been operating below annual capacity of 110,000 units in the country that is currently dominated by the likes of Maruti Suzuki and Hyundai.

Ref: Economic times article

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