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Mahindra & Mahindra stops selling vehicles in Brazil market

Mahindra & Mahindra has withdrawn from the Brazil market after seven years.

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Mahindra & Mahindra has withdrawn from the Brazil market after seven years.

It has stopped selling its pick-up trucks and sports utility vehicles in Brazil as a sluggish economy, changes in regulation and a depreciating currency hurt sales.

"Where we don't see mid-to-long-term prospects, there is no point. We call spade a spade and get out of that," said Pravin Shah, president & chief executive (automotive), M&M.

M&M was selling the vehicles through its local partner, Bramont-Montadora Industrial e Comercial de Veiculos, sold about 250 units a month "in the best of times", Shah said. The automaker on Wednesday reported 28% growth in exports in March at 4,019 units though domestic sales fell.

Total sales for the company in March 2015 fell 12% at 45,212 units as against 51,636 units a year ago, while domestic sales fell 15%. However, sales were better than estimates. Nomura had estimated sales of 42,400 units.

Exports picked up in January after dips in the last two months of 2014. Exports were mainly to neighbouring markets like Sri Lanka, Bangladesh, Nepal, South Africa, Tunisia, Chile and other South American countries.

The company also bagged a big international order. "We have received an order for 1,470 vehicles from the Philippines police. This will be executed over next few months and will be a Bolero platform based vehicle."

In fiscal 2015, the exports of the company stood at 30,185 units and grew 1.82% while domestic sales were 434,652 units as compared to 477,517 units in the previous year, down 9%.

M&M's exports have been consistently growing at 7-9% in the last three months.

Sales of passenger vehicles, including Scorpio, XUV500, Xylo, Bolero and Verito stood at 21,030 units compared with 23,433 units in March 2014, down 10.25%.

Four-wheeler commercial vehicle sales were down 19% to 14,279 units last month against 17,649 units in year-ago period, M&M said.

Shah said, "With factors such as expectation of normal monsoon, settling down of petrol and diesel prices and the likely softening of interest rates, we expect the auto industry to perform better in fiscal 2016."

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