Wednesday, June 30, 2010

Mahindra Speaks: Joint Ventures, Acquisitions, and US Vehicles

“Unfortunately, I can’t talk too much about it because it’s a legal situation. But it’s unfortunate, and we have to be honest about that. It’s not something we would have liked to happen, it’s something we are dealing with and hope to overcome it. All we are saying is that we remain committed to entering the market, but clearly this is an obstacle.” Anand Mahindra, Vice Chairman, Managing Director, Mahindra & Mahindra; regarding the lawsuit filed against Mahindra & Mahindra by US Mahindra vehicle importer, Global Vehicles USA

India’s Economic Times interviewed Anand Mahindra to get his perspective on Mahindra & Mahindra’s many recent partnerships and acquisitions in the technology, automotive, and aerospace industries.

Mahindra & Mahindra has recently acquired Australian aircraft manufacturer Gippsland Aeronautics, with the intention of building fixed-wing aircraft in India within the next three years. Mahindra has also taken over majority stake in Indian-American electric car company, Reva. Most recently, Mahindra has been rumored to be communicating with Proton/Lotus about a partnership, and they are currently completing due diligence on the potential acquisition of failing South Korean auto manufacturer, Ssangyong.

Mahindra clearly has high expectations for M&M and India to become global economic and technology powerhouses. In the interview, Mahindra emphasizes that there is method to their JV and acquisition madness:

“We will do joint ventures with other elements of the automotive industry, whether it’s trucks, vans two wheelers, everything else. We are open to alliances because what they allow us is to mimic the benefits of a large automotive company. And when you add our tractors into this then we are a company which is already over half million vehicles without even counting two wheelers which are growing, and not even counting trucks. Nobody can actually say that we have drawbacks of a niche player. We have the volumes to build scale where scale is needed, procurement, R&D etc.” – Anand Mahindra

While Mahindra is very clear about on-road vehicle and tractor market strategies, it is still unclear when their line of 30mpg, all-diesel, pickup trucks and SUVs will arrive in the United States.

Anand Mahindra’s comments certainly seem to suggest that the lawsuit filed by Global Vehicles could delay the US introduction of these rugged, India-made pickups beyond the currently expected December 2010 launch date. Further delays would be ironic considering that the foundation of the lawsuit accuses Mahindra of purposely delaying their entry into the United States. The future of the Mahindra TR20 and TR40 pickups is still unknown.

To read the entire interview, click here: None of our M&As are done for ego and size: Anand Mahindra (popup warning)


Anonymous said...

two corporations, lawsuits and counter lawsuits, it'll be years before the Mahindra pickups get here if at all. Sorry, lose another one to either Ridgeline or Taco, or anything other than the unicorn Mahindra trucks.

Anonymous said...

This press release from Mahindra be of interest to you

Mahindra Counters Groundless Lawsuit by Global Vehicles USA, Inc

"Mahindra & Mahindra (Mahindra) has filed a motion to dismiss the lawsuit that Global Vehicles USA, Inc. (GV) filed against Mahindra in the U.S. District Court for the Northern Georgia. Mahindra firmly believes GV's claims are without merit and will vigorously contest the lawsuit. Mahindra is diligently working towards satisfying all US homologation requirements and intends to submit its final application as soon as possible. Mahindra has not intentionally delayed the process and has committed substantial amount of resources behind this effort. Mahindra would like to expeditiously arbitrate the matter. The fact that GV has agreed to extensions of the deadline, demonstrates that GV was well aware of the situation and its impact. Mahindra remains committed to launch its products in the US market"

Anonymous said...

well, turns out it wasn't a Ridgeline or taco but a chevy silverado. So, if these unicorns ever become reality, maybe I have a nice silverado for sale. Now I won't be so apt to buy the unicorn sight unseen as I was willing to do previously.

cWinfield said...

Good find, Anonymous #2. No doubt M&M isn't going to rollover and admit any wrong doing. On the other side of that, I'm sure GV felt they had to do something to placate their dealer network. I think Mahindra will have a hard time proving their case unless they reveal actual reasons for the delays (which they don't seem willing to do). "Diligently working towards satisfying all US homologation requirements..." Okay, what is the hold up? Of course GV agreed to deadline extensions. Did they have any choice?

Anonymous said...

It’s great to hear that the Managing Director of the entire Mahindra Group has come out stating the company’s commitment to the US. He joins the president of the company’s automotive sector in making this commitment. If this isn’t enough to silence the skeptics I don’t know what is. Mahindra has global automotive ambitions and they know how important the US market is. Plus, this is the right time to introduce a midsize pickup. Just look at the choices out there – the newest midsize truck is the Suzuki Equator which is based on the Nissan Frontier.

dick said...

Wonder what them boys at GV are gonna do after Mahindra dumps 'em.

Oops! Did I say 'dump'? I meant 'unloads'.

Hi Andy! How's the spine?