Mahindra Navistar Given 3 Years to Show Profits

Mahindra Navistar Automotive Ltd. has been in the market for more than 2 years now and has so far accumulated total losses of Rs. 692 Crore. The board of Mahindra & Mahindra has given the truck subsidiary three more years to start showing some profits, since its US JV partner quit the table and sold off its stake for Rs. 175 Crore. The company has so far managed to sell more than 6,000 units of its products.

Not to be deterred, M&M says it is still committed to the venture and will invest 200-300 Crore more in the venture. Pawan Goenka, president, automotive & farm equipment sector, on Thursday said: "The board has given us three years to turn around the business. We will not be buying back the stake, if it did not make sense. We are doing everything we can to reduce losses. We have learnt that it is difficult to sell a truck versus a car. Here the customer needs to be convinced and one has to get into micro marketing. And in a slowing market, it is difficult to convert customers from the leaders, who are currently offering big discounts."

Source - ET