Image: Visual China

BEIJING, January 12 (TMTPOST) — Chinese automaker Great Wall Motor has extended its term sheet to acquire General Motors’ Talegon plant in Pune by three months to March. The deal might get another extension to June.

“Great Wall Motor stays committed to the Indian market. Our strategy in the Indian market hasn’t changed,” the company told Chinese news outlet Cailianshe.

Great Wall Motor had to delay the acquisition because General Motors has not yet reached an agreement with workers in the Talegon plant on compensations. The legal battle has prevented the acquisition project from attaining approval from local authorities.

The two companies had already delayed the acquisition process two times before.

Great Wall Motor plans to acquire the Talegon plant at US$1 billion to further its global strategy. The company wants to manufacture its Haval SUV and other GWM models locally in India. The acquisition plan was announced in January 2021 and was expected to be completed by late 2021.

However, the acquisition process was delayed by the pandemic and other non-market factors. The acquisition was first postponed to June and then the year-end of 2021.

“Our team in India is negotiating with General Motors’ team on details of the plant. We have not yet finalized the payment details,” Great Wall Motors’ spokesperson told investors in late May 2021, stating that the company’s investment plan in India had been stalled by the pandemic.

India is an important market for automakers. According to statistics from the Society of Indian Automobile Manufacturers, 215,626 passenger cars were sold in India in November 2021. From April to November of the 2021-2022 fiscal year, a total number of 1,829,693 cars were sold in the country. On average, 2.94 million cars were sold in India each year in the past seven years.

India is part of Great Wall Motor’s global strategy. The company has production bases in overseas markets such as Russia and India and has entered the European market. In 2021, Great Wall China’s car sales in overseas markets reached 142,793 units, registering year-on-year growth of 103.7%. The sales from overseas markets accounted for 11.1% of the company’s total sales volume. The company plans to achieve a global sales of four million units by 2025.