NEW DELHI (Reuters) – Mahindra & Mahindra Ltd will focus on developing its core portfolio of sport utility vehicles (SUVs) and their electric version, a senior executive said on Friday after joint venture negotiations with Ford Motor Co ended on Friday. .
Anish Shah, deputy general manager, said Mahindra will mainly focus on large SUVs for its core India market in the near term and switch to electric in the medium term as it develops a new strategy for its business. automobile.
“We are going back to our hearts,” Shah, who will take over as chief executive from April, told Reuters.
“We are going to look ahead to how we can accelerate our investment in electricity and really start to move into the new era. We clearly have the ambition to be a global brand and again electric travel is important, ”said Shah.
Mahindra’s high-end electric vehicle Pininfarina Battista is a starting point, Shah said, adding that the automaker would consider developing more electric platforms in India to build SUVs for local and export markets. .
Mahindra and Ford canceled their auto joint venture Thursday evening due to the COVID-19 pandemic, prompting them to reassess their capital allocation priorities.
The two companies planned to jointly develop vehicles to be manufactured in India for local sales and export to dozens of emerging markets under the Ford badge.
However, Mahindra was not convinced that the company would generate the returns necessary to justify the higher investment it would have to make in a post-pandemic world.
Shah told reporters that Mahindra initially planned to invest around 30 billion rupees ($ 410.68 million) in the business, half of which would have been equity.
Now Mahindra plans to invest the money in electric vehicles, he said, adding that he was open to collaboration with Ford in the future, including in electric vehicles.
The review is part of a larger restructuring at Mahindra whereby the company is exiting several loss-making businesses, including its South Korean unit Ssangyong Motor, to focus on earnings and cash flow.
Mahindra said on Friday he was close to making a deal with a potential investor for his majority stake in Ssangyong, which has been placed in receivership. Its total investment in the SUV maker is $ 264 million and the extent of the write-off will depend on the deal reached, Shah said.
Last year, the automaker also pulled the plug from its U.S. electric scooter unit GenZe and aircraft company GippsAero. Its other global subsidiaries include Peugeot Motorcycles.
Mahindra sold nearly 190,000 passenger vehicles in India in the last fiscal year ended March 31, giving it a market share of nearly 7%, according to industry data.
Report by Aditi Shah; Editing by Neil Fullick
