General Motors has decided to shut down its Talegaon manufacturing facility – its last factory in India a day before Christmas. This move will bring an end to the American company’s operations in the country which started in 1996. In 2017, General Motors had sold its Halol factory to another Chinese company, SAIC. The latter is using it to manufacture cars under the MG brand.
General Motors and China’s Great Wall Motors had announced a deal in January 2020 under which, the latter would buy out the Talegaon plant. General Motors was looking to sell its plant to the Chinese carmaker for more than Rs. 2,000 crore. However, 20 Indian soldiers were martyred in an encounter with the Chinese earlier this year. Tensions between India and China have been high since the incident and the Government of Maharashtra has put the deal between General Motors and Great Wall Motors on hold.
With the deal stalled, General Motors has no option but to shut down the plant which employed 1,800 people and built cars to be exported to Mexico. The American company will have to fund the closure liabilities on its own. It will have to pay for the severance payout to workers and also require an approval from the state government for layoffs.
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