While admitting the challenging market scenario due to shortfall in rain this year and possible decline of demands from rural, Mahendra & Mahendra ( M&M) top management said that its new entrant in Utility Vehicle segment TUV 3OO which was launched today in New Delhi would be a big success because it caters the requirements of cities as well.
Pravin Shah, CEO and President, M&M, Automative said that there is slum in the market and automobile sector was also going through a tough phase. However, the government’s measures would help in improving the demand in couple of months. So we are hopeful that market sentiment would improve by next month, he added.
M&M is hoping that improvement in the demand environment in the upcoming festive season and attractive pricing of its feature-packed model would help improve volumes.
The price of new vehicle, which also includes an automated manual transmission variant, starts at Rs 6.98 lakh in Delhi which is 10-30 per cent lower than its competitors Ford Ecosport, Hyundai Creta and Renault Duster.
While the lower price points and affordability are plus points and M&M is expected to garner good volumes.
“We have strong market share in rural and semi urban areas with models like Bolero, Scorpio, XUV etc, however, TUV 3OO would be a grand success in both rural and big cities. TUV has been designed with the requirements of big cities as well,” Vivek Nair Chief Marketing Officer, Automotive told RM on the sidelines of the launch event.
M&M confidence also comes from the fact that UV share in passenger segment in 2014-15 has gone up to 23 percent from 15 percent a year ago. Mahindra’s new sub-4m SUV will not be a replacement of the Bolero and is expected to give a tough competition to the like of the Ford EcoSport and the recently launched Maruti S-Cross.
M&M was going through a tough phase over the last few quarters with lower demand for its UVs as more customers preferred compact SUVs. Another challenge comes from a sharp decline in the more-profitable tractor sales on the back of poor monsoons and rural slowdown.
M&M officials pointed out that much would depend on the uptick in rural incomes for tractor volumes to reach earlier levels, the new UV launches should arrest the overall decline in M&M market share.