After reporting their highest ever quarterly sales for the SUV segment, Mahindra and Mahindra expects further growth through new launches and strengthening consumer demand, Rajesh Jejurikar, Executive Director of Auto and Farm Sectors at Mahindra and Mahindra, said.
The company’s SUV sales, which surpassed 75,000 units for the recently concluded quarter, were driven on the back of older models such as Mahindra Thar, Mahindra Bolero Neo, and Mahindra XUV 300. The company, however, expects to gain a larger revenue share through its new product offerings, Jejurikar said in the interview with CNBC TV18 on July 6.
“We still haven't converted the Scorpio-N hype into bookings and the initial feedback on that is extremely good,” he said referring to the company’s latest SUV offering.
Mahindra and Mahindra achieved a 64 percent year-on-year growth rate with the company selling 54,096 units across all its product categories in June.
“Last year's numbers are not a representation of how we’re doing. We had a difficult supply side situation from April-December last year. We were affected worse than others on the semiconductor front and had a high dependence on Malaysia for chips,” he said.
In addition to increasing its market share, Mahindra and Mahindra is looking toward widening its revenue base. The company is aiming to leverage its diverse SUV portfolio in order to benefit from the growing penetration of SUV-modelled cars across different consumer segments, Jejurikar added.
The company expects the latest SUV offering to add market share rather than cut into the revenue pie of existing SUV models in their portfolio.
According to Jejurikar, the Scorpio-N will provide the company an opportunity to cut across different segments and has been priced in a way to attract larger volumes. “Our overall approach is not to think about a particular segment by way of just size and dimensions. Customers go for an overall appeal,” Jejurikar said.
Mahindra and Mahindra also reported an 18 percent growth in tractor sales for June. The company continues to remain cautiously optimistic as the month’s numbers surpassed their expectations, Jejurikar said. He attributed the growth in the segment to healthier realisations received by farmers due to improved terms of trade.
On the electric vehicle front, the company remains a market leader in the electric three-wheeler segment with a 73.4 percent market share reported at the end of the last fiscal year. The company has seen good momentum and has bettered its sales every month in the segment, Jejurikar said.
“In the SUV space, we have very very aggressive plans. But we’ve decided not to talk about that. We have set aside the date of August 15 when we will be travelling to Canterbury, UK, where our new design center is located, and launch a very comprehensive strategy on electric SUVs. You will see a lot of excitement from us in the EV space,” he said.
Along with a larger market share, SUVs also command longer wait times.
“Putting myself in the customer's shoes, I don’t think anyone is going to be happy waiting that long. But we’re still getting 9,000 new customers every month. What does this tell us? The product has hit a sweet spot where there is nothing that can compare to it in terms of value proposition,” he said.
Maruti Suzuki, which will be launching their latest SUV model on July 20, Tata Motors, and Hyundai are among the top players in the growing SUV market in India.
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