Mahindra & Mahindra has cancelled the bid to manufacture small delivery trucks for the United States Postal Service that is worth $6.3 billion. The company has written off the investment it had made towards this project, a company official said on Friday.
Mahindra Automotive North America (MANA), a subsidiary of M&M, was looking at setting up a plant in the US last year.
The $500-million investment by M&M in MANA was subject to winning the US Postal Service bid and the company chose not to participate in it, said Anish Shah, Deputy MD and Group CFO, M&M, while answering questions post the announcement of the company’s Q1 results. The company was shortlisted as the final four and what it had invested so far was a “very small amount which was essentially in preparation of the bid and all that has been written off”, he added.
The investment in MANA would not have met the targeted return on equity of 18 per cent, the company said.
In 2018, MANA was involved in a litigation filed by Fiat Chrysler Automobiles in the US alleging that Mahindra had infringed on the designs of its subsidiary, Jeep, with the new Mahindra Roxor, and sought to prevent the sale of the off-road vehicle in the US market.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.