This week in Auto:  Daimler India drives in profits, Mahindra in launch juggernaut mode

Mahindra XUV300 | Rs 8.3 lakh | The Mahindra XUV300 also managed to bag the best -selling compact SUV in May. This is at a time when the restriction were just easing off and when you expect the usual market leaders like the Maruti Suzuki Vitara Brezza and the Hyundai Venue to keep the lead.

On one hand, auto companies are packing their bags to leave the country following unsustainable losses, but the maiden profits reaped by one European company however, provides a glimmer of hope.

In other news, an industry underdog is fighting its way back into the market from where it was dislodged as the segment leader far too quickly. These, and more, are the major developments in the auto space during this week.

Six years after setting foot in India, Daimler AG’s truck and bus making company recorded yearly profits for the first time last year. With sales growth of 35 percent, 2018 was also the best year for the company since starting sales operations in 2012.

This is considered to be a thorough turnaround for Daimler considering only four years earlier, the company was declared financially sick after a massive erosion in its net worth in 2014. Company officials declined to give details of the profit

Ashok Leyland, the country’s third biggest commercial vehicle producer, has lined up investments for a slew of projects for FY20 even as the truck and bus maker gets busy to expand its portfolio in the light-duty segment.

The Chennai-based company will be investing around Rs 1,000 crore as capital expenditure (capex) for the next financial year on electric vehicles, light commercial vehicles and capacity enhancement programs.

Japanese auto maker Honda on February 13 said it will launch the latest version of Civic model in India next month, thus completing its sedan lineup in the country.

With sedans -- Amaze, City, Accord and the upcoming Civic -- the company will have four products across various price points to cater to a wide range of customers. Honda, which is present in the country through wholly- owned subsidiary Honda Cars India (HCIL), will now look at bolstering its presence in other segments, including sports utility vehicles (SUVs).

Three months after Eicher Motors announced the resumption of production at the troubled Oragadam plant near Chennai after a 50-day stand-off, workers at the factory have resorted to a strike again in February.

The strike comes at a time when Royal Enfield is ramping up production of two new models – the Interceptor 650 and the Continental GT 650 – which were launched recently in India and the overseas markets.

Royal Enfield maker Eicher Motors' third quarter (October-December) consolidated profit grew by 2.4 percent year-on-year  (YoY) to Rs 533 crore over low revenue growth and weak operating income. Profit in same quarter last year stood at Rs 530.9 crore.

Revenue from operations in Q3 increased 3.2 percent to Rs 2,341 crore year-on-year, but Royal Enfield sales volume declined six percent YoY against 3.6 percent rise in Q2.

Since the start of September,  (SUV) specialist Mahindra & Mahindra (M&M) has launched several all-new models in the market, more than any other company during such a short span of time.

The company started with the Marazzo in September, before moving to Alturas G4 in November and culminating with the XUV300 in February.

These launches were inadequately interspersed with limited breathing space for the marketing team to plan the launches. Usually a marketing teams ploughs the ground at least six months before D-day.

Still the euphoria over the XUV300, a mini urban soft roader was palpable. At the sidelines of the launch event in Mumbai Pawan Goenka, managing director, M&M equipped, “Our product engineers have not slept peacefully since the last four months.”

In between, M&M engineers were bending their backs on meeting the Bharat Stage VI challenge too.

While the Alturas G4 is essentially a new-gen SsangYong Rexton that M&M decided to launch under its own brand, the other two (including their engines) are built at the Mahindra Research Valley in Chennai. The collective cost of developing both is little over Rs 2500 crore.

Both projects were commissioned around the same time three to four years ago when M&M was taking the heat from car market leader Maruti Suzuki and Hyundai who were making solid inroads into M&M’s home turf. M&M has seen a free fall in market share over the years from an enviable 50 percent market share to its current 26 percent of the domestic utility vehicle market.

A major chunk of that share stood on M&M’s long standing dark horse Bolero and not the new generation models such as TUV300, Nuvosport and KUV100, each of which performed below the company's expectations.

But the new vehicles are a class apart as per M&M. Not only are they built using global standards with a striking design language, they are also tested for quality parameters never used before. The XUV300 for instance is the only vehicle in its category to offer seven airbags along with disc brakes on all four wheels.

Marazzo was partly designed by Italian design house Pininfarina, which is owned by M&M. It has earned the best crash safety rating (NCAP 4 star rating) among all Mahindra vehicles produced till date.

Goenka is hoping to generate sales of 8,000-9,000 units a month from all the three models. The company hopes this will provide a boost of four to five percent in market share in the UV segment. That is an ambitious task, given that rivals are waiting in the wings to launch their models.

Tata Motors, Maruti Suzuki, Hyundai, Jeep, Kia, Toyota, Honda, Skoda, Volkswagen, MG Motors are in advanced stages of product launches and product development for the UV segment.