Eyeing top two spots in sub-compact SUV market in 2-3 years with XUV 3XO: M&M's Rajesh Jejurikar

Rajesh Jejurikar ED, Auto and FES M&M giving a product presentation of Mahindra XUV 3OO at the Nashik facility

By launching the XUV 3XO at Rs 7.49 lakh (ex-showroom), India’s largest utility vehicle-maker Mahindra and Mahindra (M&M) has undercut the Tata Nexon by Rs 60,000-65,000 (depending on the variant).  Tata Nexon ICE version (priced in the range of Rs 8.15 lakh to Rs 15.6 lakh, ex-showroom), which was the market leader for the past two financial years, averages around 12,000-13,000 units per month.

With the XUV 3XO subcompact Sports Utility Vehicle (SUV), the homegrown automaker is looking to target customers who aspire to buy an ultra-premium SUV XUV7OO  (priced in the range of Rs 13.99 lakh to Rs 26.99 lakh ex-showroom), according to a top official of the company.

In the process, the company aims to be the market leader in the hyper-competitive subcompact Sports Utility Vehicle (SUV) market, where other models like Maruti Suzuki Brezza, Hyundai Venue and Kia Sonet are already present.

“In this Rs 6 lakh segment (of subcompact SUVs), which is 25 percent of the market, we are actually the number fifth player. This is a big opportunity for us to disrupt. In the next three years, we target to be number one or two in the subcompact monocoque SUV segment. To plan for this, we have to do something disruptive and that is where the 3XO comes in,” said Rajesh Jejurikar, executive director and CEO, auto and farm equipment sector, M&M.

According to him, “the right to win” comes out with the offer that one brings to the market. “We have done everything possible to create a proposition to ensure we have the right to win. It doesn’t come only out of price, product, technology or features. It is a combination of getting everything right and we think we have done that.”

Without sharing any sales target for the model, he stated, “We have set up a fungible capacity (along with XUV 4OO) of 9,000 units per month that will be expanded to 10,500 units per month.”

He also clarified that 60-65 percent of the sales will be from gasoline-powered - version and 35-40 from diesel variant. However, he clarified that there won’t be a CNG offering for this model in the near term.

“We have a very aggressive gasoline strategy to encash on the size of the 65 percent share (in subcompact SUV segment.” He also revealed that while it continues to do well in tier 2 and 3 cities, the ‘real opportunity” to pick up “substantial volumes” for this model will be from tier 1 cities.

According to him, the total size of the SUV market last year was about 2.5 million per annum and about half of that was in the sub four-metre segment at around 1.2 million (per annum). Within that, out of 50 percent is sub-four metre SUV segment, which it considers as the “direct relevant segment”.

Exuding confidence that the SUV segment will grow faster than passenger cars (sedans, hatchbacks) in FY25, he maintained that are not true-blue SUVs. “A substantial chunk of SUVs in India are car crossovers. So, it is not a like-to-like comparison by saying that it’s all pure SUVs (which are selling). I would say that the way SUVs are growing in India is faster than cars.”

“Buoyed by this, existing and upcoming models (5-door Thar), we aim to grow in mid-teens in our overall volumes during FY 25, Jejurikar further added.

Puneet Gupta, director, S&P Global Mobility is of the view that the XUV 3XO has the potential to revolutionize Mahindra's presence in the sub 4-meter SUV segment, enabling the company to capture a larger portion of the compact SUV market.

“Given Mahindra's current dominance in the midsize SUV segment, they might be considering expansion into other sub segments as well. X3o at this price will be a game changer product and can be among the customer favourites due to fresh and stunning looks,” said Gupta.