Ssangyong, a Korean car manufacturer which was bought by Mahindra in 2010 is considering building a manufacturing plant in China according to Mahindra’s Executive Director Pawan Goenka.
Ssangyong to make in china?
“China is easier to look at right now because Ssangyong already has a presence there. We have some traction and need to ramp up our products for local manufacturing,” Goenka told Reuters. “China is here and now, US is the future. We are still deciding what it takes for us to launch in the US.” Building cars in China would mean lower prices for Ssangyong, thus helping to kick off the demand. The brand sold around 2,460 cars last year, down from 11,976 in 2014. “Yes, right now China is down, but if we can get the right pricing then I think we should be able to benefit there,” he said.
Ssangyong has been under pressure to scale up operations outside its home market of South Korea after the Indian conglomerate spent 522.5 billion won (US$432.35 million) in acquiring the company. Since then Mahindra has pumped in 1 trillion won (US$827.47 million) in order to revive its flagging fortunes. Last year, Ssangyong Motor posted 61.9 billion won (US$50.9 million) in net loss, a 21.65 percent rise from a year earlier. Currently, Ssangyong’s Pyeongtaek plant produces 150,000 cars annually and to gain a bigger foothold in the Chinese SUV market at competitive rates, the company has decided on having a manufacturing base there for better economies of scale.
Last year it sold just 2,460 vehicles in China, down from 11,976 in 2014. The company plans a push for the Tivoli compact SUV which will be the volumes product for Ssangyong. The company is gearing up for launch in the American market by 2020 when the SIV-2 concept becomes a reality. SIV-2 was unveiled at the Geneva Motor Show. The company is also expected to bring the Tivoli to the Indian market sometime soon.