As part of a strategy to return to profit, Mahindra & Mahindra Ltd., the preferred bidder for Ssangyong Motor Co., could launch up to three models within four years.
Pawan Goenka, president of Mahindra’s automotive and farm equipment division, said that Ssangyong will develop the vehicles based on designs that have never been used. In an interview, Goenka revealed that Mahindra may also build Ssangyong models in India.
Goenka believes that buying the company is the “easy part” and that turning it around is the “more difficult part.” As part of plans to limit reliance on local sales, Mahindra may use Ssangyong engines in pickups it intends to sell in the US.
Last month, Mahindra agreed to purchase Ssangyong in order to gain access to technology and an international dealer network. Goenka added that it will cost more to develop new models in South Korea than when it’s done in India.
He explained that Mahindra spends about 8 billion rupees ($172 million) to develop a vehicle in India. Mahindra seeks to complete the acquisition of a controlling stake in Ssangyong by end of the year.
Ssanyong, which was previously controlled by SAIC Motor Corp. (China’s biggest carmaker), entered court protection from creditors in February 2009 due to losses incurred by the drop in SUV sales. [via autonews - sub. required]