Increased competition in its bread-and-butter SUV segment, price wars and regulatory headwinds have put M&M in a spot. In July, for the first time ever, none of its products made it to the list of 5 top-selling SUVs in the country. CNBC-TV18 tried to understand how M&M is trying to get its mojo back.
On the face of it M&M is doing just fine. It has seen its utility vehicles grow month after month this fiscal. It responded quickly to the diesel ban by re-engineering engines of the Scorpio and XUV and the company maintains a good guidance for the rest of the year.
But, look beyond the numbers, and there are worrying signs for the country's pre-eminent SUV-maker.
While M&M's SUV segment grew at a healthy 17 percent in the April-August period, it is less than half the 40 percent growth the industry has clocked as a whole. This means its market share in the utility vehicle segment has fallen from almost 35 percent in August last year to around 29 percent this year. What's more distressing is that with increasing competition from traditional car-manufacturers like Maruti, none of M&M's SUVs were among the top-5 SUVS by sales.
"Yes we (M&M) would have liked to have a model in that but we don't. This is because we have more products now. You see the number of SUV products in the market today. Every carmaker wants to call itself an SUV player now," says Executive Director Pawan Goenka.
The big bet with the KUV 100 has also not paid off. Since its launch in January, sales have slowly, but steadily declined every month coming in at under 3,000 units in July, against levels that topped 6,000 units. This means most of the money is now riding on the petrol bet.
"We have launched a petrol vehicle but we are still known to be a diesel vehicle manufacturer. So the label with Mahindra is diesel," Goenka says, adding, therefore, a lot of people who want to buy a petrol vehicle still may not be convinced that our petrol vehicle is as good as our diesel one. "So, when you look at the shift from diesel to petrol and given that we are not known for petrol that has taken our volume down. As petrol vehicle gets used, confidence comes up I certainly hope the volume will come up," he adds.
But M&M is not throwing in the towel just yet. It is working overtime to plug product gaps with competitive pricing whether it's the refreshed version of its old war-horse Bolero or its first petrol-powered Scorpio or its first cross-over product to take on Maruti's Brezza.
M&M clearly has its work cut out for it especially when you consider that in less than 5 years, the country has seen a slew of SUV launches and what was a 10-product segment is now a 30-product segment.
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