General Motors, on Thursday, announced that it is awarding contracts to a number of key Tier 1 Information Technology suppliers - Wipro, IBM, HP, EDS, Cap Gemini and Compuware Covisint, to provide systems integration services to its extended global enterprise over the next five years. The initiative was driven by the ending of a 10 year split-off agreement with EDS that expires in June 2006.

Announcing the win, Sudip Banerji, President — Enterprise Solutions of Wipro Technologies said “the total contract value of the work in middleware systems awarded to us is estimated to be in excess of $300 million in 5 years and the contracts become due for renewal in June 2006. This makes us the only Tier 1 ‘offshore service provider’ in the list of winners.”

Elaborating, he said Wipro has a teaming agreement with EDS which will give it an edge in areas where it does not have a presence, like in South Africa. Currently Wipro has around 500 people working on General Motors projects and the number will go up to 1,000 people over the next 18 months after June 2006. Wipro has raked in $30 million over the last 4 quarters from its General Motors projects, said Banerji.

GM will spend approximately $15 billion over the next 5 years. “This is a significant milestone for GM and its IT & Services Group” said Ralph Szygenda, Group Vice President and Chief Information Officer, General Motors. As a result of savings generated through the bid process, the spend rate will be less. Approximately 50 per cent of the spend is being awarded to systems integrators today. As part of the overall process to re-source this business, the work was broken down into 40 segments that included everything from computing operations to application support for areas such as automotive product development, manufacturing and supply chain on a global basis as well as GMAC financial services.