We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is General Motors Betting on India's Auto Parts Market?
Read MoreHide Full Article
Key Takeaways
GM relaunches ACDelco in India via a licensing deal with Assurance to produce batteries and lubricants.
GM targets India's 300M vehicles and a $12B aftermarket rather than re-enter the crowded new-car market.
GM'S partner Assurance is investing Rs180cr in lubes and Rs300cr in batteries, aiming for 25k units daily.
General Motors Company (GM - Free Report) is re-entering the world’s third-largest car market in a different way several years after leaving India. Rather than returning to sell vehicles, the Detroit-based company is focusing on the automotive parts business, which is typically less visible but often highly profitable.
The automaker recently relaunched its global aftermarket brand ACDelco in India through a licensing partnership with Assurance International Limited. Under this arrangement, Assurance will produce and distribute ACDelco-branded batteries and lubricants for the Indian market.
General Motors previously sold vehicles in India under its Chevrolet brand but withdrew from the market in 2017 after struggling to secure a meaningful market share despite operating there for many years. Following the exit, ACDelco also discontinued its Indian operations in 2020.
The company’s renewed presence focuses on India’s rapidly expanding vehicle repair and replacement ecosystem instead of competing in the crowded automotive sales market. The country’s vehicle parc, the total number of vehicles in operation, has surpassed 300 million, creating a large aftermarket sector valued at more than $12 billion annually and continuing to grow as vehicles age.
For global automakers that have scaled back local manufacturing, the aftermarket segment offers stable margins without the substantial capital investment required for vehicle production.
Initially, ACDelco’s lineup in India will include automotive batteries and high-performance lubricants for both passenger and commercial vehicles. These products will be manufactured locally at facilities operated by Assurance in Hisar.
Assurance has already invested about Rs 180 crore in a lubricant blending and packaging facility with a daily capacity of 100,000 litres. In addition, a battery manufacturing plant, planned with an investment of roughly Rs 300 crore over three years, is expected to begin production by April and eventually reach a capacity of around 25,000 units per day. GM carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
GM’s Price Performance, Valuation and Estimates
General Motors has outperformed the Zacks Automotive-Domestic industry and its peers, Ford Motor Company (F - Free Report) and Tesla (TSLA - Free Report) . GM shares have gained 28.1% compared with the industry’s growth of 9.9%. F has gained 4.8%, whereas Tesla has risen 0.8% during the same period.
Image Source: Zacks Investment Research
From a valuation perspective, GM appears undervalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.36, lower than the industry’s 3.3. F and Tesla are trading at forward sales multiples of 0.28 and 14.25, respectively.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GM’s 2026 and 2027 EPS has moved up 3 cents and 8 cents, respectively, in the past seven days.
Image Source: Zacks Investment Research
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Why Is General Motors Betting on India's Auto Parts Market?
Key Takeaways
General Motors Company (GM - Free Report) is re-entering the world’s third-largest car market in a different way several years after leaving India. Rather than returning to sell vehicles, the Detroit-based company is focusing on the automotive parts business, which is typically less visible but often highly profitable.
The automaker recently relaunched its global aftermarket brand ACDelco in India through a licensing partnership with Assurance International Limited. Under this arrangement, Assurance will produce and distribute ACDelco-branded batteries and lubricants for the Indian market.
General Motors previously sold vehicles in India under its Chevrolet brand but withdrew from the market in 2017 after struggling to secure a meaningful market share despite operating there for many years. Following the exit, ACDelco also discontinued its Indian operations in 2020.
The company’s renewed presence focuses on India’s rapidly expanding vehicle repair and replacement ecosystem instead of competing in the crowded automotive sales market. The country’s vehicle parc, the total number of vehicles in operation, has surpassed 300 million, creating a large aftermarket sector valued at more than $12 billion annually and continuing to grow as vehicles age.
For global automakers that have scaled back local manufacturing, the aftermarket segment offers stable margins without the substantial capital investment required for vehicle production.
Initially, ACDelco’s lineup in India will include automotive batteries and high-performance lubricants for both passenger and commercial vehicles. These products will be manufactured locally at facilities operated by Assurance in Hisar.
Assurance has already invested about Rs 180 crore in a lubricant blending and packaging facility with a daily capacity of 100,000 litres. In addition, a battery manufacturing plant, planned with an investment of roughly Rs 300 crore over three years, is expected to begin production by April and eventually reach a capacity of around 25,000 units per day. GM carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
GM’s Price Performance, Valuation and Estimates
General Motors has outperformed the Zacks Automotive-Domestic industry and its peers, Ford Motor Company (F - Free Report) and Tesla (TSLA - Free Report) . GM shares have gained 28.1% compared with the industry’s growth of 9.9%. F has gained 4.8%, whereas Tesla has risen 0.8% during the same period.
Image Source: Zacks Investment Research
From a valuation perspective, GM appears undervalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.36, lower than the industry’s 3.3. F and Tesla are trading at forward sales multiples of 0.28 and 14.25, respectively.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GM’s 2026 and 2027 EPS has moved up 3 cents and 8 cents, respectively, in the past seven days.
Image Source: Zacks Investment Research