Brexit effect? Mahindra pulls the plug on its electric cars in UK

A year after the entry of Mahindra's e2o into the electric car market in the United Kingdom, India's automaker, Mahindra and Mahindra is reportedly set to withdraw sales of electric cars from the market. These developments bring an abrupt end to Mahindra's ambitious dream of expanding to foreign markets.

It is said that the meagre sales of e2o, the electric car that was launched to replace the G-Wiz, may have prompted Mahindra and Mahindra to stop the sales of the model in the UK. The company has now written to its customers in the country about its decision and is putting forward a buyback option, reports Reuters.

All the orders that were pending are also being cancelled. The Indian maker has cited Britain's decision to exit from the European Union (Brexit) as the reason for its slide. The e2o electric car, which entered the UK market in April 2016 failed to live up to the high expectations of the company. The sales are believed to have fallen down further post Brexit.

"The level of e2o sales achieved is at an untenable level for us to maintain the investment required, hence our decision to cease trading at Mahindra and Mahindra UK with immediate effect," Reuters quoted Mahindra's letter dated April 10 to one of its buyers in the country.

Even though there is no clarity on the future plans of Mahindra Electric after ceasing its operations in the UK, officials linked to the company told Reuters that the company will now focus on the Indian market where there has been a surge in demand for electric cars. It will contemplate its re-entry to the UK at an appropriate time.

Mahindra and Mahindra had earlier hinted at plans to expand to the markets in Europe with Norway, Sweden and the Netherlands. However, it now remains to be seen how the fortunes of the electric car of Mahindra will pan out in the coming days.

Source: Reuters