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General Motors quits South Africa

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The Chevrolet Utility is assembled and sold in South Africa by General Motors

The Chevrolet Utility is assembled and sold in South Africa by General Motors

American automaker General Motors is quitting South Africa, with Japanese automaker Isuzu set to take over its investments.

GM, which locally assembles Chevrolet models in Port Elizabeth, in addition to importing other Chevrolet models, announced on Thursday that, subject to approval by regulatory bodies, it “will phase out manufacturing and sales of Chevrolet vehicles”, in addition to working with PSA [Group] “to develop the future strategy for the Opel brand in South Africa.” GM recently sold its European interests to PSA Group, the makers of Peugeot and Citroen.

Isuzu Motors will assume control of GM’s Port Elizabeth plant, which will be used for the production of heavy and medium duty commercial trucks; it will also claim GM’s network while setting its own dealer network.

As outlined in the press statement, Opel and Chevrolet owners in South Africa can still expect aftersales service from their regular dealer until the end of the year; beyond 2017 however, it’s Isuzu’s network that will offer these services.

“Isuzu is building a strong base to grow on the African continent in the long term…We are committed to the South African market,” said Haruyasu Tanishige, an Isuzu sales executive.

China and North America

General Motors has explained its decision to quit the South African market, which it first entered nearly a century ago, as a business decision that would allow it to make greater returns on investments elsewhere, namely the U.S. and China.

It has made similar moves in the recent past, including giving up its majority stake in Kenya (its East African hub) to Isuzu this February. It has also shuttered operations in Australia, India and discontinued the sale of Chevrolet in Europe.

While the local market in South Africa has been in decline for the past three years (in 2016 alone, dropped by 10%), forcing Dodge, Citroen and Chrysler to quit, China is the largest market for new vehicle sales, and is forecast to take nearly 30 million new vehicles this year.