SsangYong Agrees to Use "Final Lifeline" to Help Stay Alive

Korean SUV specialist SsangYong will use parent company Mahindra’s one-time cash infusion to help ease its liquidity concerns due to softening global demand brought about by the COVID-19 pandemic.

The SsangYong board says it has agreed to use the one-time cash infusion of 40 billion won (USD 32.86 million) offered by India’s Mahindra & Mahindra last week. However, after this SsangYong will have to seek funding elsewhere.

Last week, Mahindra, which owns 74.65 percent of SsangYong pulled the plug on a USD 423 million investment plan on the struggling Korean automaker.

In February, SsangYong’s global sales fell 27.4 percent year-on-year.

Last year, they posted an operating loss of 281.9 billion won (USD 231 million) and a 5.6 percent drop in sales.

COVID-19 May Spell the End of the Road for SsangYong Motor

As carmakers struggle with falling sales and halting of production, it’s a matter of time when some end up struggling. The first automaker that may fall victim to COVID-19-related economic slowdown? SsangYong.

A report out of Reuters says its largest stakeholder, Mahindra, will not invest further in the South Korean SUV specialist. This comes as Mahindra finds itself trying to conserve cash after sales nosedived 88 percent last month.

In a regulatory filing, Mahindra, which holds a 74.65 percent stake in SsangYong said:

“After lengthy deliberation given the current and projected cash flows, the M&M [Mahindra & Mahindra] Board took a decision that M&M will not be able to inject any fresh equity into SYMC [SsangYong Motor Corporation] and has urged SYMC to find alternate sources of funding.”

The announcement came less than two months after Mahindra said it would invest US$ 423 million to make SsangYong profitable by 2022. Among the plans was to launch an all-electric version of the Korando SUV. That was since canceled.

Mahindra said it would consider a special one-time infusion of up to 40 billion Korean Won (USD $32.34 million) over the next three months to help SsangYong continue running its business while it seeks other sources of funding.

In 2010, Mahindra rescued SsangYong from near insolvency.

SsangYong and Changan Open Their First Dealership in Metro Manila

Auto Asia—the brand concept that combines Korean specialist, SsangYong and China’s largest automobile group, Changan under one roof opens its first showroom in Metro Manila.

The newest brand under the Autohub Group of Companies, Auto Asia opens in Otis, Manila. During its official opening, they’ve also announced that they are the exclusive dealership franchise holder for SsangYong and Changan in Metro Manila. They also have plans to expand this deal to cover Luzon and Mindanao by 2020.

“We are proud to partner with the Autohub Group in bringing Auto Asia to Manila. Their strong dealership presence in the area gives us confidence in the long-term success of the two brands with carry,” says Japheth Castillo, President of Berjaya Auto Asia, Inc., the distributor of both SsangYong and Changan.

As the Korean SUV specialist, SsangYong has made a strategic move to offer an all diesel, all CBU line-up. In order to make it more enticing to buyers, Autohub has including free V-Kool window film and a free flight voucher to selected Asian destinations for each SsangYong unit; this is on top of the standard 5-year warranty and 3-year free PMS package offered by Berjaya Auto Asia, Inc.

Meanwhile, for Changan, Autohub is flexing its financing muscle and has offered it with an exclusive low monthly payment of less than P 10,000 for 5 years. In fact, they’ve come up with a special campaign, “Make More When You Spend Less,” that ensures profitability for businesses due to its low maintenance costs.

Auto Asia Otis – Manila is located at 1120 Quirino Avenue Extension, Paco, Manila. You may reach them through their truck line at +63 2 8561 0973 or through mobile phone at +63 917 528 4442.