It would not be an opportune time to impose additional duties on diesel vehicles, said Lowell C. Paddock, President and Managing Director, General Motors India, on Monday.
Speaking at an event to mark the inauguration of a new facility of General Motors Technical Centre, Mr. Paddock said, “This is not the time to impose a tax on diesel vehicles, given the sluggish growth of the auto industry in the last year.” Given the industry's “wider connection” with manufacturing, he warned that this could have a wider impact on industrial output.
Mr. Paddock said the company was prepared to meet any eventuality arising from a fresh levy on diesel cars in the forthcoming Union Budget. The company's Talegaon powertrain facility in Maharashtra, which could produce both diesel and petrol engines simultaneously, gave the company greater “flexibility” to cope with changes in demand, he said.
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Although General Motors' sales had been “flat,” Mr. Paddock said the company sold about 1.11 lakh vehicles in 2011 despite not launching a new car during the year. “High interest rates have been a factor in hampering growth in 2011,” he said.
He called for a “stable and consistent fuel policy,” warning that if the opportunity was missed in 2012, it might become more difficult for the government in the following year, when elections were around.
Mr. Paddock said the company aimed to “regain production momentum” through fresh offerings from its Chevrolet platform.
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“Apart from the Sail, the MPV, and the Tavera, be ready for a couple of surprises this year,” he said.
Referring to the negotiation of the India-European Union Free Trade Agreement, Mr. Paddock called for a “level-playing field,” and “countervailing duties to offset the advantages that would accrue to importers of completely built units.”