Mahindra to cancel investment in SsangYong Motor due to COVID-19

Updated Apr 01, 2021 | Same topic: COVID-19 Updates

The COVID-19 pandemic continues to affect the auto industry.

India's Mahindra and Mahindra Ltd will not invest further in its struggling South Korean unit, SsangYong Motor Co. According to a report by Reuters, the automaker is trying to save cash in an effort to ride out the Coronavirus crisis.

BREAKING: Duterte approves extending enhanced community quarantine in Luzon until April 30 |  via ANC

Despite parting of ways, Mahindra still wishes the best for SsyangYong as the India automaker asked SsangYong to look for other means of funding amid COVID-19 Pandemic with Mahindra posting an 88% plunge in March sales.

"After lengthy deliberation given the current and projected cash flows, the M&M Board took a decision that M&M will not be able to inject any fresh equity into SYMC and has urged SYMC to find alternate sources of funding," Mahindra said in a regulatory filing.

Mahindra's board has also started several measures to bolster its balance sheet in the face of the pandemic. The decision was made less than two months after Mahindra committing to invest over $400 million to turnaround SsangYong Motors.

ssangyong dealership PH

SsangYong dealership in the Philippines

Mahindra acquired a 70% stake in SsangYong for $463 million way back in 2010 in hopes to rescue the South Korean company from bankruptcy.

In 2010, Pawan Goenka, Mahindra president, said, “The coming together of Mahindra and SsangYong will result in a competitive global UV (utility vehicle) player.

Together with its financial capability, M&M offers competence in sourcing and marketing strategy, while SsangYong has strong capabilities in technology.” But despite several attempts, it has struggled to revive the SsyangYong’s fortune.

Recently, the South Korean brand temporarily suspended its operations to comply with the ECQ imposed by the Philippines government.

Also, SsangYong PH extended its free PMS & 5-year warranty window for 30 days for those whose schedules fall within the quarantine period.

The Rexton, SsangYong's contender in the tightly-contested midsize SUV segment in the Philippines.

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Know more about SsangYong

SsangYong

<p>SsangYong Philippines has been under Berjaya Motor Philippines since 2016, and at present, the brand has two dealerships in the Philippines and is based in Makati City. Currently, SsangYong Motors brands itself as the Korean SUV specialist that is represented by its lineup. In the Philippines, the brand is currently offering six car models: SsangYong Musso, SsangYong Musso Grand, SsangYong Rexton, SsangYong Korando, and SsangYong Tivoli.</p>

Rex Sanchez

Rex Sanchez

Author

Rex started off his career in the aviation industry before entering Philkotse as a staff writer. Two things excite him the most: first is staying up to speed with the latest news in the industry that uses engines as their heart and soul. The second is imparting them in a well-detailed manner. His passion for anything with wheels started when he was young – from Tamiyas to family-friendly sedans, and anything in between.

Someday, Rex only wishes to drive on random highways with friends in a third-gen Mitsubishi Delica with aftermarket sunroofs, if he couldn’t get the Starwagon Super Exceed edition.

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