NEWS

Mahindra & Mahindra plans utility vehicle blitz in New Year to win market share

Monday, Dec 22, 2014

Mahindra & Mahindra (M&M) has lined up close to a dozen launches for the New Year, as the leader in the utility-vehicle (UV) market attempts to gain back the ground lost to soft roaders such as the Renault Duster and Ford EcoSport in the past couple of years. Even as the company's market share shrank to an all-time low, its stock has lost lustre as well and underperformed the auto sector.

With Maruti Suzuki and Hyundai Motor also lining up UV launches, Mahindra is aiming to hit the market with as many as seven utility vehicles in 2015. These are likely to include a soft roader (micro SUV), lifestyle UV (new Thar) and premium UV (facelifted XUV 500) as well as petrol and diesel hybrids and a proposed Bolero replacement codenamed U301.

Never in the past has the company lined up so many launches for a year. M&M also intends to tighten its grip on the pick-up space with the facelifted Genio and Bolero, along with three mini truck options in the sub- 1.2-tonne space. The new offerings — the plans is to launch one every 35-45 days — are likely to bring in incremental volume of 80,000 to 90,000 units a year, several people close to the company said. A company spokesperson said the company doesn't comment on any future plans.

While competition was one factor that hurt the company, another was the diesel deregulation announced at the beginning of 2013. The price difference between diesel and petrol has narrowed to about Rs 11 a litre now from Rs 20 in January last year, a development that led many buyers to opt for petrol vehicles, which are also cheaper than diesel-powered ones.

M&M which predominantly makes diesel vehicles, was one of the worst hit by this change in customer preference. The company last week announced weekly production shutdowns through March 2015 to reduce stocks. In FY14, Mahindra's volume fell almost 20%. The downhill drive continued into fiscal 2015, with volumes declining almost 15% to 1.45 lakh units in the April-November period. Having missed out on the compact UV race for two years, M&M is considering advancing its micro SUV, which is targeted at premium hatchback buyers, sources said.

"Earlier, the plan was to launch the micro SUV in January 2016. This was advanced to October. They are requesting vendors for a May deadline, but it seems like a tall ask," said one of the people in the know.

 

Source : http://economictimes.indiatimes.com/