To develop new vehicles and engines
Mahindra & Mahindra has said it will invest $900 million over the next four to five years in SsangYong Motor of Korea on developing three new vehicles and six engines. M&M bought a majority stake in the Korean company for $463.6 million in 2010.
Pawan Goenka, President – Automotive & Farm Equipment sectors, M&M, said the investment would be from internal accruals, fresh equity and debt.
After being acquired by M&M, SsangYong’s sales have improved and have grown by 6-7 per cent in the Korean market. Break-even will happen in another year-and-a-half, according to Goenka.
“That will happen over the next year-and-a-half. Beyond that, we have not made complete plans on how the investments will take place,” he added.
On M&M’s utility and sports utility vehicles, Goenka said the company was working on full capacity expansion and fresh versions of Scorpio and XUV500 were expected in future.
M&M, which had announced buying out Navistar in its truck joint venture, expects to close the deal by January 31, for which it has applied for various Government approvals.
“It will be a 100 per cent subsidiary of M&M and naming of the new company and its product lines will take some time,” Goenka, told reporters here.
He said Navistar was still interested in exporting trucks and would do so on its own branding (Navistar).