BS-VI put pricing pressure on diesel cars; petrol and electronic vehicles in focus: Mahindra & Mahindra

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Published: July 17, 2019 4:00:26 AM

In its annual report for 2018-19, M&M said the cost differential involved in meeting BS-VI emission for diesel vehicles will be higher, which is likely to put pricing pressure on the diesel fuelled vehicles.

BS-VI, pricing pressure, diesel cars, petrol, electronic vehicle, Mahindra & Mahindra, diesel car priceThe company, which is known for its diesel powertrains, has already started introducing some of its latest vehicles with a petrol variant.

Realising that the upcoming BS-VI norms from April 1, 2020 will lead to substantial hike in diesel car price, Mahindra & Mahindra (M&M) is actively developing petrol engines to be introduced across its product range, while also working on developing the electric versions of at least two existing models.

The company, which is known for its diesel powertrains, has already started introducing some of its latest vehicles with a petrol variant. In its annual report for 2018-19, M&M said the cost differential involved in meeting BS-VI emission for diesel vehicles will be higher, which is likely to put pricing pressure on the diesel fuelled vehicles.

“Your company is actively pursuing a strategy to develop and introduce petrol engines across the product range,” the company told its shareholders, adding there are aggressive time and cost targets for meeting BS-VI emission for diesel engines.

Companies, including Maruti Suzuki and Renault India, have already announced they won’t be selling diesel cars post April, 2020, as their cost of upgradation from BS-IV to BS-VI will be much higher and therefore there would be no demand. Already, diesel cars are pricier, in the range of Rs 1-1.5 lakh, as compared to their petrol counterparts. With the new emission standards, the price difference could go up to Rs 2-2.5 lakh.

On electric vehicles, the company said it has earmarked Rs 500 crore for its EV project under the new policy of Maharashtra government and will be developing electric versions of SUVs KUV100 and XUV300. “This investment will be utilised towards product development and capacity enhancement for electric vehicles and related components,” it added.

In 2018-19, M&M said it, along with its subsidiary Mahindra Electric Mobility (MEML), sold a total of 10,276 EVs — 1,811 four-wheelers and 8,465 three-wheelers — as against 4,026 EVs in the previous year.

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