Report: India Likely to Replace Korea as GM Export Hub

General Motors Co., which sold fewer than 58,000 vehicles in India last year, aims to hike its annual volume there to 400,000 units by 2025, Reuters reports.

Doing so would multiply GM's market share in India to 5% from about 1.8% today. The news service points to projections that say India's annual vehicle market will expand from about 3 million units today to 8 million by 2025.

GM's growth plans for India are likely to offset declining output in South Korea, Reuters says. Its report cites IHS Automotive data suggesting GM's output in Korea will shrink to 365,000 by 2025 from 630,000 last year. A big reason: Labor costs in Korea have jumped nearly 50% in five years, threatening the country's future as GM's biggest Asian export hub.

Stefan Jacoby, who heads GM's International Operations unit, acknowledges GM "needs to face reality" in Korea. He emphasizes to Reuters that GM has no specific plan to reduce capacity there. But he describes the country's militant unions as a "huge challenge" to the carmaker's efforts to control costs.