Mahindra and Mahindra have announced that they will be giving up control and looking for new investors in SsangYong Motor.
SsangYong Motor are a South Korean SUV maker and Mahindra and Mahindra own a 75 per cent stake in the brand. Of late, the company have been struggling with sales which has resulted in recurring losses for Mahindra. The Indian brand recently issued a statement revealing their intent to exit all loss-making ventures during the coronavirus pandemic. Mahindra had saved SsangYong from insolvency back in 2010 but the company has unfortunately not been able to turn around their fortune.
SsangYong are in need of a new investor and the company is working to see if they can secure an investment soon. Mahindra have reported a net loss of Rs 1,955 crore solely from the SUV maker SsangYong this year. Along with this announcement, Mahindra have also announced their decision to shut down the Genze e-scooter business.
Anish Shah, Managing Director of Mahindra and Mahindra said “As part of a wider restructuring effort by the company to cut costs and prioritize capital expenditure as it rides out the coronavirus pandemic, Mahindra would review all its loss-making businesses over the next 12 months. Where there is no clear path to profitability it would look for a partnership or close down those businesses, but in those that can clearly generate equity returns of 18 per cent or those that are of strategic importance, Mahindra would continue to invest.”
