Singapore (Bloomberg): General Motors Co. said it’ll leave Australia, New Zealand and Thailand by year-end because it continues to exit poor-performing markets and focus its resources on new technologies like self-driving cars and electric vehicles.
The largest US automaker said it’ll take $1.1 billion in charges mostly within the first phase, of which $300 million in cash, to sheath the charge of leaving those markets. The company will retire the Australian Holden brand, withdraw the Chevrolet brand from Thailand and sell its Rayong plant there to China’s great wall Motor Co., GM said in a statement.
GM’s downsizing comes as CEO Mary Barra continues to shrink the automaker to the point where it gets almost all of its profits from the US and China. The company has made a calculated gamble to scale back its global presence and invest in technology instead of sinking money into attempts at fixing its core business.
Make it right…
“I’ve often said that we’ll do the correct thing, even when it’s hard, and this can be one among those times,” Barra said during a statement. “We have the correct strategies to drive robust returns, and prioritizing global investments which will drive growth in the future of mobility.”
The downsizing is an element of a long-running strategy for GM since the Detroit-based company emerged from bankruptcy in 2009. The company pulled the Chevrolet brand from Europe in 2015, left Russia that very same year and sold its German Opel unit and British Vauxhaul brand to France’s Peugeot SA in 2017.
The company also will wind down its sales, design and engineering operations in Australia and New Zealand and retire the Holden brand by 2021. GM President Mark Reuss ran Holden in 2008 and 2009, but since then its market share has fallen from almost 13 percent to 4.1 percent, GM said in a statement. As GM downsizes overseas, the corporate is pouring money into electric vehicles in a very bid to catch Tesla Inc. GM has already spent several billion to develop self-driving cars with Cruise llc, which it bought in 2016.