SAIC Motor, China’s largest car maker, is expecting profit within three years at its Indian joint venture with General Motors through sales of small, low-cost cars, its chairman said on Wednesday.
In an interview with Reuters in Taipei where he is accompanying the mayor of Shanghai on a visit, SAIC chairman Hu Maoyuan said the Indian car market would grow to 5m units a year in five years from 2m now, and was the company’s most important market outside China.
Top Indian automaker Maruti Suzuki said earlier this week it expected the domestic market to grow much faster than projected to reach annual sales of 4.5-4.6m cars by 2015, up from less than 2m cars a year at present.
The company also admitted that it may not be able to hold on to its 50% market share as rivals increase their investment in the country.
“We want to build a stable base [in India], then we can compete in the whole of southeast Asia,” SAIC’s Hu told Reuters on Wednesday.
He added that SAIC would increase capital at its China auto financing venture with GM by about half to CNY3bn to take advantage of growing demand for loans in the world’s biggest car market.
He saw over 10% growth in China’s vehicle market this year.
Earlier this month SAIC reported a return to profit in the fourth quarter, boosted by government stimulus incentives. It runs vehicle manufacturing ventures in China with General Motors and Volkswagen and takes a 19.9% slice of the country’s vehicle market.