08-29-2009, 03:04 AM
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>India's Mahindra seeks to buy U.S. factory to build pickups</b>
Automotive News ^ | August 28, 2009 - 4:16 am ET |Â
Posted on Fri Aug 28 2009 13:12:17 GMT-0700Â
Mahindra & Mahindra Ltd., seeking to dodge costly import duties on its pioneering India-made pickups, may buy an existing U.S. plant to build them.
Pravin Shah, Mahindra's executive vice president of international operations, told reporters today in New Delhi that such a purchase would be Mahindra's most economically feasible path.
"We are exploring various options," he said.
The comments signal a change in Mahindra's U.S. strategy.
In May, senior company officials said they would most likely avoid the 25 percent "chicken tax" on imported pickups by having a third-party manufacturer assemble the trucks here from knock-down kits.
Mahindra, which already makes farm tractors in Calhoun, Ga., plans to enter the U.S. passenger-vehicle market early next year with a compact diesel-engine pickup made in India.
Change of plans
Under the plan outlined in May, the company would import completed trucks at first and pay the 25 percent tariff. The company would then have the trucks assembled in the United States by an outside firm as volume increased.
In January 2008, project officials said they were close to announcing an agreement with an unidentified Ohio truck manufacturer to do the pickup assembly. Such an agreement was never announced.
Mahindra has changed its U.S. plans before. This summer, the company delayed its market entry for the second time. Originally, it was planned for early 2009. It was then delayed until fourth quarter 2009. Now it is slated for first quarter 2010.
Officials have attributed the setbacks to last-minute product changes requested by U.S. retailers and recommended by consultants at J.D. Power and Associates.
330 dealers
Dealerships have been built in Florida, Georgia and Ohio in preparation for the launch. Mahindra's independent distributor, Global Vehicles U.S.A. Inc. of Alpharetta, Ga., says 330 dealers have been signed to sell the trucks.
Last week, a dealer in Birmingham, Ala., declared his intention to become that market's second Mahindra dealer.
Following the launch of the pickup, Mahindra intends to introduce a compact diesel-engine SUV based on its Indian-market Scorpio, along with model variations to follow. All models will feature a four-cylinder clean-diesel engine.
Shah said the pickups will be "competitively priced," adding that the United States would become the company's largest export market in "some time."
Mahindra has planned a total outlay of about $100 million for the U.S. launches of the pickups. Shah said about $80 million has been spent.<!--QuoteEnd--><!--QuoteEEnd-->
Automotive News ^ | August 28, 2009 - 4:16 am ET |Â
Posted on Fri Aug 28 2009 13:12:17 GMT-0700Â
Mahindra & Mahindra Ltd., seeking to dodge costly import duties on its pioneering India-made pickups, may buy an existing U.S. plant to build them.
Pravin Shah, Mahindra's executive vice president of international operations, told reporters today in New Delhi that such a purchase would be Mahindra's most economically feasible path.
"We are exploring various options," he said.
The comments signal a change in Mahindra's U.S. strategy.
In May, senior company officials said they would most likely avoid the 25 percent "chicken tax" on imported pickups by having a third-party manufacturer assemble the trucks here from knock-down kits.
Mahindra, which already makes farm tractors in Calhoun, Ga., plans to enter the U.S. passenger-vehicle market early next year with a compact diesel-engine pickup made in India.
Change of plans
Under the plan outlined in May, the company would import completed trucks at first and pay the 25 percent tariff. The company would then have the trucks assembled in the United States by an outside firm as volume increased.
In January 2008, project officials said they were close to announcing an agreement with an unidentified Ohio truck manufacturer to do the pickup assembly. Such an agreement was never announced.
Mahindra has changed its U.S. plans before. This summer, the company delayed its market entry for the second time. Originally, it was planned for early 2009. It was then delayed until fourth quarter 2009. Now it is slated for first quarter 2010.
Officials have attributed the setbacks to last-minute product changes requested by U.S. retailers and recommended by consultants at J.D. Power and Associates.
330 dealers
Dealerships have been built in Florida, Georgia and Ohio in preparation for the launch. Mahindra's independent distributor, Global Vehicles U.S.A. Inc. of Alpharetta, Ga., says 330 dealers have been signed to sell the trucks.
Last week, a dealer in Birmingham, Ala., declared his intention to become that market's second Mahindra dealer.
Following the launch of the pickup, Mahindra intends to introduce a compact diesel-engine SUV based on its Indian-market Scorpio, along with model variations to follow. All models will feature a four-cylinder clean-diesel engine.
Shah said the pickups will be "competitively priced," adding that the United States would become the company's largest export market in "some time."
Mahindra has planned a total outlay of about $100 million for the U.S. launches of the pickups. Shah said about $80 million has been spent.<!--QuoteEnd--><!--QuoteEEnd-->