Having lost significant market share to new launches from other companies, Mahindra & Mahindra (M&M) is back with a big bounce with the launch of compact SUV TUV300. Earlier this fiscal, the launches of Hyundai’s compact SUV Creta and Maruti’s crossover S-Cross had eaten into the market share of Mahindra, pulling its share down to 29.8% in August compared to 41.2% in April. However, with the launch of the TUV300, Mahindra's share has jumped to 39% in October, while Hyundai and Toyota have fallen a few notches.
The TUV300, which was launched on September 10, had over 12,800 bookings by the end of October. With the high demand for the new product in the domestic market, the company is focusing on the home front while deferring export plans. “We have identified (some export markets), but we want to stabilise supply for domestic demand first before we start exporting,” Pawan Goenka, executive director at M&M and group president (auto and farm sector), told analysts after the quarterly results for the July-September period. A steady sale of 5,000 units a month will be “very good” performance for the new product, he said.
The utility vehicle space has seen increasing competition in recent months with the launch of the Hyundai Creta and Maruti Suzuki S-Cross, as well as upgrades, including Maruti's Ertiga and Ford Ecosport. However, in volume terms, the utility vehicle sales have not gained enough traction in the initial months of the financial year. In the April-October period, industry-wide utility vehicle sales saw a meagre growth of 1% over the same period last year, while in October alone, the segment saw strong growth of 20% over October last year, mainly on festive demand.
Mahindra is hoping that its new offering will get good sales numbers steadily and not attain a peak in the first six months and then witness declining numbers. “We have had products where we see very good response in the beginning and then it sort of slows down after some time, and we have had products where the response continues to remain very good,” Goenka said. He cited the example of the XUV500, which has recorded consistent sales of around 3,000 units per month for almost two years now, compared to the Xylo, which had a “very good performance for some time and then it slowed down”. Goenka said he would “like to put the TUV300 in the XUV500 category”.
Moreover, the Bolero, which lost its position of top-selling SUV to Creta in August, has regained the slot after two months. With sales of over 7,750 units in October 2015, the Bolero displaced Creta from the top spot.