Ssangyong Motors will invest approximately one trillion won (US$936 billion) for four years to come in the development of new models. President Park Geun-hye met with Chairman Anand Mahindra of the Mahindra Group, the largest shareholder of the automaker, during her recent state visit to India to confirm the investment plan diplomatically. Most of the amount is going to be spent on the development of three new vehicles, including the X100 crossover utility vehicle, which is slated to be unveiled next year.
Investment has already been kicked off, and Ssangyong is currently working on the mold for the X100. It is planning to expand its production lines for the vehicle during the second half of this year. What is important is the fact that the source of the investment comes from not Mahindra but Ssangyong itself. But the Mahindra Group also has announced that it is willing to provide financial support if necessary.
Ssangyong Motors was acquired by the group three years ago after court receivership. Last year, the company set a new sales record for the first time in 11 years, posting a higher growth rate than any other automaker in Korea. Specifically, its growth rate amounted to 34.1% in the domestic and 11.9% in the overseas markets, respectively.
If the pace continues, it will be free to spend 200 to 300 billion won (US$187.2 to 280.8 million) each year without incurring any loss. This is why Ssangyong considers that the investment plan will pose no burden until 2017.