Mahindra & Mahindra, which stepped in to rescue troubled SUV maker Ssangyong last year, is to set up distribution networks for the South Korean company in markets including India and Africa.
Mahindra Group managing director Anand Mahindra said at the Seoul motor show that The Korando and Rexton will be introduced first into India. He added that Mahindra, the largest SUV producer in India, also plans to use its sales network in Africa where it sold 9,500 cars last year to market Ssangyongs.
Go deeper with GlobalData
“SUVs are perfectly suited for the terrain of Africa… the joint team of Ssangyong and Mahindra will make a strong impact,” he said.
Ssangyong this month exited court led bankruptcy protection, in force since 2009, following the completion of the deal in which Mahindra took a 70% stake in the company for US$476.7m.
The automaker ran into trouble in 2008 as a slump in sales of SUVs dried up its cash reserves, leading to job cuts that sparked strikes that lasted many months. Ssangyong now plans to develop new vehicles with the new owner’s backing.
Chief executive Lee Yoo-Il said two companies are working together to roll out electric cars within the next two years. Mahindra also plans to open a South Korean unit of its auto financing firm to help Ssangyong sell its vehicles.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataMahindra said his group is behind Ssangyong for the long term.
“We are proud investors of Ssangyong and we believe very firmly in Ssangyong’s future,” he said, when asked if his group was considering cutting its stake in the near future.
“We are committed therefore to the turnaround of the company’s fortunes. This is going to be a long journey in which we intend to be long-term players.”
Anand Mahindra also reaffirmed his company’s commitment to Ssangyong. He said: “We have a track record of turning companies around and we are not interested in short-term gains.
“This is not the first international investment, this is not our first acquisition. We do not make short term investments. We are accustomed to building businesses, and we are accustomed to being marathon runners.”
