Aditi Sharma

NEW DELHI, (Reuters) – Stellantis CEO Carlos Tavares sees India as a more profitable market than it had previously anticipated. This is despite the fact that India faces significant challenges in China and Russia.

India, the country where Stellantis sells their Jeep and Citroen marques, is a small fraction of global carmaker sales. But Tavares indicated that revenues from the South Asian nation will more than double by 2030. Operating profit margins are expected to reach double-digits over the next few years.

Indian market has been dominated in Asia by Hyundai Motor and Suzuki Motor. This means that Western carmakers have had difficulty making money in India. Ford Motor (NYSE.) Co was the latest Indian carmaker to cease selling vehicles.

If you approach things in India the right way, it is possible to be profitable in India. “Some Western carmakers have failed because they didn’t recognize that,” Tavares stated at Tuesday’s virtual media roundtable.

According to him, this means sourcing parts locally, vertically integrating the supply network to reduce costs and building cars that Indian customers want and can afford.

Stellantis (formed in the beginning of 2021 from the merger between France’s PSA and Fiat Chrysler) (FCA), has outlined its new group strategy in March. The company is stepping up efforts to launch electric cars (EVs) while maintaining profitability.

India’s focus comes as the fourth largest carmaker in the world is struggling to sell cars in China. It is also facing challenges in Russia where production has been suspended due to war in Ukraine.

Tavares explained that India has a greater opportunity because of the challenges they face.