Mahindra & Mahindra (M&M) has reworked the strategy for its non-utility vehicle (UV) business comprising two-wheelers, commercial vehicles (CVs) and cars as UV sales fall. Mahindra’s UV volumes dropped 5% in May and 6% last fiscal. The UV industry, however, grew 5.3% in FY15.
In May, M&M’s overall passenger vehicle (pv) sales dropped 7%. Cars and vans fell a steep 30% while the CV business saw a 7% decline. two-wheeler sales fell 18.43% in FY15.
While the company will launch nine new products, including two compact vehicles — a segment not yet in its portfolio — it also plans to renew focus on the two-wheeler business with increased marketing spend. In the passenger car segment, an electric vehicle will come out of the Verito platform. In the CV segment, an investment of R300 crore is planned to bring three new products, Pawan Goenka, executive director, M&M, told FE.
M&M doesn’t plan to expand anymore the car business it had acquired from the joint venture with Renault. The UV maker, which makes SUVs like the Scorpio, Bolero and XUV 500 , has two cars, the Verito sedan and a hatchback, the Verito Vibe. But it is making no more investments in building the platforms. “We don’t have expertise in all the areas. Both the cars have insignificant share, but we didn’t want to lose any opportunity,” said Pravin Shah, president and chief executive (automotive) at M&M.
On two-wheelers, Goenka said the business has been lagging and in the current fiscal, apart from one new product, there will be a lot of marketing spend to give the bikes more visibility. M&M will launch a premium superbike, the Mojo 300. In January, M&M completed a 51% stake acquisition in Peugeot Motorcycles, a business that hasn’t taken off in India. In future, Goenka said, the acquisition will help M&M build a superbike portfolio. “It might help us build the business in India, but it will not be there in the commuter segment. Peugeot, if it comes, will be in the premium bike segment,” he said.