Isuzu might take over GM’s Australian Truck Unit

Isuzu might take over GM’s Australian Truck Unit

The largest truck maker in the Japanese market Isuzu is considering taking over the truck manufacturing business of the American auto giant General Motors in Australia. In addition, they might also take over the GM’s truck units in South Africa. They are now likely to buy around 40 percent stake in the Australian venture, which is currently owned by GM.

General Motors is in financial trouble in their home market USA where the end consumer is rapidly moving towards efficient and reliable Japanese vehicles. The company had tried offering heavy discounts, which resulted in depleted profits for the company. As a result, they are now considering selling off non-profitable units to other manufacturers to cut costs and get back to profitability.

If this deal is confirmed, it would be the second of such kind for General Motors in Asia. GM is said to be raising cash after posting $3.8 billion of losses in the first nine months. Isuzu on the other hand, wants to shift production overseas to cut costs and shield earnings from currency swings. Therefore, it suits them perfectly. GM’s earlier deal was with Toyota Motor Corp. to whom they sold their 8.7 percent shares in Fuji Heavy Industries Ltd.