Ssangyong loses $432 million parent company investment

The future of Ssangyong Australia’s planned new model supply and rollout is in doubt, after majority owner Mahindra & Mahindra announced that it was holding back its planned investments in the Korean SUV manufacturer.

This comes less than two months after announcing a $423 million investment by Mahindra, with a plan to make Ssangyong profitable by 2022. Instead, Ssangyong has been ‘urged’ to seek out alternative funding sources, but management is also considering a ‘one-time infusion’ of up to 40 billion Korean Won ($32 Million) over the next three months.

Mahindra owns a 74.65 per cent stake in Ssangyong, since investing in the struggling manufacturer back in 2010.

One of India's largest carmakers, Mahindra is also a big player in the global tractor industry. The company has been hit hard by COVID-19 however, reporting an 88 per cent drop in March sales in their local market.

How this will affect Ssangyong in Australia is unclear so far. Since re-launching in late 2018, the Korean manufacturer has been building a range of new and competitive products like Musso, Musso XLV, Rexton, Tivoli, Tivoli XLV and (most recently) Korando.

In 2019, Ssangyong sold 1040 cars in the Australian market. Unsurprisingly, it was the Musso 4x4 ute that accounted for more than half of that, with 545 sales.

There are new models on the horizon, including the Korando EV and facelifted Tivoli, which could be affected by the loss of financial support.

We’ve reached out to Ssangyong Australia, an got this statement from Chief Operating Officer Chris Mandile:

"Mahindra has confirmed its intention to continue supporting SsangYong Motor and to maintain its relationship with the SsangYong business.

"In anticipation of the possibility of a prolonged low-growth phase internationally caused by the spread of Covid-19, the company has already embarked on strengthening the business with a range of innovations across a number of areas.

"SsangYong have a three-year business plan and structures to support its operations both here and abroad."

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