Will Mahindra XUV400 e-SUV have enough firepower to combat Tata Motors' e-Nexon?

Mahindra XUV400

At a time when auto industry players across various segments were in quasi-marketing mode on World EV Day by talking about the green quotient of products and solutions, Mahindra and Mahindra (M&M) decided to go off the beaten track and unveiled its much awaited electric SUV -- Mahindra XUV400 -- a day earlier at Mahindra Research Valley (MRV) in Chennai. While the test drives of this electric SUV will kick off in December 2022, the bookings will commence from the first week of January 2023.

Before the product unveiling ceremony kicked off, this Moneycontrol reporter informally asked a senior official of the Mumbai-based company if the firm can actually pit its maiden electric SUV against market leader Tata Nexon electric variants (EV Prime and EV max), and the official exuded a lot of confidence, stating: “Our product’s features will let you know which product is a cut above the rest”

Rajesh Jejurikar, executive director, auto and farm sectors, M&M, said: “We believe we have what you call a very strong C-segment SUV. What our survey indicates to us is that 25 percent of SUV buyers and intenders rank electric vehicles at number 1. That is how large an opportunity it is.”

During a post-unveil Q&A session, when M&M was quizzed on the probable sales target, tentative price points for XUV400 and whether it will be able to outsell Tata Nexon in the future, he maintained, “This is more like a category creator rather than competing with any model. We are open to several price points.  But we will reveal the final prices once we garner enough feedback from the market.”

It is to be mentioned that M&M’s compatriot Tata Motors had introduced Nexon (initially offered in ICE or internal combustion engine options) subcompact crossover in 2017. The electric version of the Nexon, which is currently priced at Rs 14.99 lakh and above, was revealed in December 2019 and went on to become the biggest selling e-car in the country in 2020. In the process, Tata Motors updated the name of the standard Tata Nexon EV to Tata Nexon EV Prime in order to differentiate from higher range model Nexon EV Max (launched in May 2022).

The XUV400, which is essentially an extended wheelbase version of XUV300 (run purely on ICE), is powered by a 39.4 kWh Lithium-ion battery pack with a range of 456 km (ARAI certified) on a single charge and the electric motor can churn out 147bhp of power output and 310Nm of peak torque. This car can also attain 0-100 km per hour acceleration in 8.3 seconds. The e-SUV is being positioned by M&M in the C-segment SUV category and is 4200 mm long and is the widest e-SUV in the category at 1821mm, as per M&M’s claims.

Tata Nexon EV Prime, on the other hand, is equipped with a 30.2 kWh battery pack with an ARAI-rated range of up to 312 km (on a single charge) and the electric motor produces 127bhp of maximum power and 245 Nm of peak torque. It can accelerate from 0 to 100 kmph in 9.9 seconds while achieving a top speed of 120 kmph. For EV Max, the electric motor produces 106.64 kW of maximum power and 250Nm of peak torque and goes from 0–100 kmph under nine seconds. It has a 40.5 kWh battery with an ARAI-rated range of up to 437 km on a single charge.

Tata Motors spokesperson, when contacted by Moneycontrol, didn't offer any comments either on the competitive offering by Mahindra or on its strategy to retain its current Nexon's marketshare.

While deliveries of the XUV400 are scheduled to begin from the end of January 2023, the first phase of the rollout will cover key urban cities such as Mumbai, Hyderabad, Delhi NCR, Bengaluru, Kolkata, Chennai, Pune, Ahmedabad, Goa, Jaipur, Surat, Nagpur, Trivandrum, Nashik, Chandigarh and Kochi.

A prominent Mahindra dealer principal Moneycontrol spoke to said on the condition of anonymity, “We have been apprised by M&M that the tentative ex-showroom price should be retailed in the range of Rs 11-13 lakh and lower than Tata Motors’ Nexon EV. However, the attractive price tag is more to do with test marketing and gauging response to its XUV400 before the company introduces its Born Electric range of products beginning 2024.”

M&M had last month already announced its partnership with Volkswagen Group for sourcing components from the European automaker’s MEB (open platform for EVs) for its purpose-built electric vehicle platform INGLO. In the process, the homegrown utility vehicle maker is looking to roll out five electric SUVs under two brands—XUV and the all-new electric-only brand Born Electric (BE)—by 2027.

Numbers tilted in favour of Nexon so far

According to the Federation of Auto Dealers Association (FADA), 17,802 electric cars were sold in 2021-22; Tata Motors commanded an 85 percent share of the market thanks to phenomenal numbers generated by the electric variants of its Tigor and Nexon. However, M&M could manage to sell only 156 e-cars during that period.

During the first quarter of FY2023 too while Tata Motors’ retail sales were close to 7,000 units, M&M could barely dispatch 42 units because of lack of relevant product lines. In July 2022, 3,295 electric four wheelers were sold in India out of which Nexon EV managed to sell 2,878 units, which is 87.34 percent share of the market.

Despite lacklustre performance in the passenger EV space in the past, Mahindra sounded an optimistic note.

“When we look at market opportunity, we look at two buckets. While one is market segmentation and the second is about customer segmentation. In terms of market segment, the C-segment SUV market is about 32,000 units per annum and the B-segment is about 66,000 units per month. In terms of EV penetration, C –segment brands (of electric cars), one representing the 0.2 percent of the market, the other representing 0.7 percent of the market. In the B-segment, there is one electric vehicle which represents 3.5 percent of the market. The market opportunity for us is to drive penetration across the B and C segment offerings of the market,” added Jejurikar.

However, analysts are skeptical if M&M will be able to eat up Tata Nexon’s share in the e-SUV space. As Ranojoy Mukherji, auto industry writer and analyst, puts it, "Mahindra seems to have a segment leader on its hands with the XUV400, but they need to sort out their logistics including production constraints at the earliest."

Likewise, Puneet Gupta, director, S&P Global Mobility, feels that Nexon is a proven model with strong word of mouth. It will take some time for Mahindra to enjoy the same reputation. However, this category of buyers is more experiential so they may like to exercise other choices like XUV400. Tata has a better ecosystem of charging through its group companies,” maintains Gupta.​