Asian Tech Press (Jan 12) -- Chinese auto manufacturer Great Wall Motor (GWM) has extended its term sheet to acquire U.S. car maker General Motors' Talegaon plant in India by another three months to March 2022, according to Indian media reports.
The Economic Times reported the news on Wednesday and said Great Wall Motors also kept the term sheet window open for a further extension to acquire the plant by June 2022.
The reason for this delayed acquisition between GWM and General Motors (GM) is that the latter has yet to reach an agreement with workers at the Talegaon plant in India over a labor dispute, so the deal has not been approved by local regulators.
Last January, as part of the company's global strategy, the maker of Haval SUVs signed an agreement with GM to acquire GM's Talegaon plant in Pune, India, for $1 billion to manufacture its branded products, including Haval, there. At the time, the both parties planned to complete the deal by the end of 2021.
Industry insiders believe that India's potential economic growth and export prospects were the main reasons for Great Wall Motor's decision to acquire the Indian plant in the first place. Through the overseas acquisition, it will seize the growing opportunity for electric vehicles and further promote the company's transformation into a global technology mobility company.
However, due to COVID-19 and China-India tensions, the acquisition did not go well for Great Wall Motor, and the term sheet had been extended in the first half of 2021 to the end of the same year. Notably, the extension this month is the second one.
In response, a GWM spokesperson said, "Great Wall Motor continues its commitment to India with no change in our strategy for the Indian market."
"The term sheet has been extended as we remain committed to our plans in relation to the site," said George Svigos, director of Internation communications at General Motors.
Great Wall Motor has planned to enter the European market and has laid out production bases in Russia and Thailand. And the Haval H6 HEV, as the first model to produced at the Rayong plant, is equipped with L2 autonomous driving technology, officially launched in the Thai market on June 2021.
However, with the acquisition project in India postponed again, its overseas market map may be somewhat missing.
