A year after coming up with the second-generation Thar (in 2020), Mahindra and Mahindra (M&M) started working on the five-door version of the lifestyle Sports Utility Vehicle (SUV). On 15th August this year, the company finally launched Thar Roxx at a starting price of Rs 12.99 lakh. With a broad spectrum of variants across different price points, the homegrown utility vehicle maker is confident that its Thar portfolio will be among the biggest volume drivers in the segment in the next two to five years.
“Models priced above Rs 12.5 lakh comprise around 45 percent of the SUV market, and we have a market share of 27 percent. So, we have the opportunity to make Thar the number one brand over the next three to five years in the Rs 12.5+ lakh category," Rajesh Jejurikar, M&M Executive Director and CEO, Auto and Farm Sector, told reporters on the sidelines of the model’s launch.
He said that M&M already has two brands in this bracket, and its Scorpio portfolio (consisting of Scorpio-N and Classic) is currently the number one brand in the Rs 12.5+ lakh market. He also stated that XUV7OO was the number five brand in this category.
Ravi Bhatia, MD, JATO Dynamics India, an auto analytics firm, believes that M&M's aim to lead the >Rs. 12.5 lakh price segment is “ambitious” but “not unrealistic”. The Thar brand has strong recognition, and this new variant could significantly boost their market share, he feels.
"Compared to its three-door counterpart, the Roxx offers more space and features," said Bhatia, adding that, "At 4.4 m, it's significantly larger than the sub-4m Thar 3D, and includes additions like ADAS and a 360-degree camera." On pricing, Bhatia observes, "The 14 percent premium over the three-door model seems justified, given the additional features and space. It's positioned competitively within its segment."
Per industry data, Hyundai Creta has long been leading the four+ metre SUV segment with sales of 1,62,773 units in FY2023-24. In the same period, Maruti Suzuki’s Grand Vitara came second with 1,21,169 units, followed by Kia Seltos at 1,00,423 units.
Capacity expansion
M&M revealed that when the Thar was introduced, the company sold about 6,000 units a month as it started attracting customers from all segments, and it expects a similar experience with the five-door avatar. Notably, the SUV manufacturer is banking on “mainstay appeal” by Thar Roxx to take pole position in the Rs 12.5 lakh and above SUV segment.
“It is going to appeal to people across segments and will create its own growth path. If you have two or three very successful new products in a sub-segment, then the entire sub-segment grows,” said Jejurikar, and added, “While this product will get a very good mainstream urban audience, it will also do very well in rural markets.”
Jejurikar didn’t share any sales target, but indicated that M&M is building additional capacity for producing up to 4,000 units of Thar Roxx per month, which will take the brand's overall output to 9,500 units per month.
According to Bhatia, "The Thar family could achieve monthly sales of 8,000-9,000 units. This launch, along with M&M's planned electric vehicle releases, indicates a strong push in the mid-to-premium SUV market."
Cannibalisation
While acknowledging some cannibalisation between the two versions, Jejrurikar stated that it has taken adequate measures to ensure that Roxx doesn’t eat into Thar’s sales. He also indicated that the company has designed its capacity with some amount of fungibility between the two products, which are rolled off the same assembly line at Nashik.
“You're going to fundamentally see two segments. And the very interesting thing about the Thar Roxx is it can be the only car in the house, because it is a mainstay product. While the Thar three-door was typically a second car, or for young couples who just wanted to have this, this new model can actually go into both the segments,” noted Jejurikar.
Puneet Gupta, Director, S&P Global Mobility, stated that the three-door variant may be cannibalised as the five-door version offers "superior practicality."
“While the three-door variant was meant more for enjoyment, the five-door version makes the vehicle more accessible to friends and family. With mounting pressure on sales, this strategic shift will enable Mahindra to capture a previously untapped customer base that had ignored the earlier model.”
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