General Motors (GM) India has written to the Gujarat state government requesting that its closure application for its Halol plant be put on hold as it discusses the sale of the facility with prospective buyers. Citing sources in the state labour department, Business Standard reports that the automaker had submitted a closure application in September 2015 but later requested that the government defer a decision until further notice. "The state government then said we cannot put an application on hold for an indefinite period. It is best the company files a fresh application as and when it is ready," the report cites a GM India official as saying. As a result, no deadline has been set for the plant's closure. A GM India spokesperson declined to comment further, stating only that the company was examining a number of options in relation to the Halol factory. GM has already moved several of its workers in Halol to Talegaon in Maharashtra.
Significance: Under India's labour laws, a manufacturer needs to obtain permission from the labour department before shuttering a plant. Notice of at least 60 days and the clearing of all workers' dues are also required before a manufacturing plant can be shut down. As a result of GM's request, it is unlikely now that the plant will be shuttered in June, which was the original closure date when the automaker outlined its restructuring plans last year. GM is believed to be negotiating the sale of the plant to China's SAIC. The Business Standard report adds that a deal may take place at a valuation of nearly INR15 billion (USD226 million). Although a deal is still some way off, SAIC is keen to participate in the Indian market.
