M&M arm looks to step up presence in used car market

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SummaryMahindra First Choice Wheels, a used car retailer and part of the $14-billion Mahindra & Mahindra Group, is aiming to expand its sales network to 200 outlets by the end of the year and add nine more service stations under Mahindra First Choice Services by March 2013.

Mahindra First Choice Wheels, a used car retailer and part of the $14-billion Mahindra & Mahindra Group, is aiming to expand its sales network to 200 outlets by the end of the year and add nine more service stations under Mahindra First Choice Services by March 2013.

Mahindra First Choice’s move comes at a time when the sale of used cars in the country is growing at 10-11% compared with new cars. Car sales in July grew just 6.7%, the slowest in three months, as more buyers, looking for an upgrade, preferred used cars. Mahindra First Choice’s sales grew 25% for the year ended March over the previous year to 34,000 units. For this fiscal, it is targeting a 32% growth.

“Our aim is to create an ecosystem for the used cars and out of warranty cars where we can provide, sales, after sales service and financial service, just like the primary car market,” Rajeev Dubey, president (group HR & after-market) and member of the group executive board, M&M, told FE.

“We have 11 service centres and we want to go up to 20 by the end of March 2013,” said Dubey. “We will also be expanding the sales points under Mahindra First Choice Wheels to 200 by the end of the fiscal.” Mahindra First Choice Wheels has 181 outlets in 102 cities. By 2015, M&M plans to have 475 Mahindra First Choice Wheels outlets and 300-350 Mahindra First Choice Services’ service centres.

“The expansion of sales and service network will synergise the company’s online presence with brick-and-mortar outlets,” said Dubey.

“We have to back up what we offer online with delivery, so having a wide sales and service network is crucial.”

The company will continue to own and operate service stations till the number becomes substantial. “By the time we reach 30-40 such stations, we can offer franchisee opportunities,” said Dubey.

The company is also training mechanics at a centre in Hyderabad. “We would need manpower and since mechanics are not used to mutli-branded car servicing we need to train them,” said Dubey. With such initiatives in place, Mahindra First Choice Wheels aims to sell 100,000 cars by 2015.

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