‘Resurrection of Bolero is happening soon’

Pravin Shah believes that the SUV momentum is back at Mahindra & Mahindra with the product blitzkrieg last fiscal.

During the two years preceding these launches, the company was conspicuous by its absence in compact SUVs and lost out to competition as a result. Shah, however, is confident that this void has more than been made up by the KUV100, TUV300 and the more recent NuvoSport which are expected to keep the sales numbers ticking.

“The new products were born out of customer need and the space that is destined to grow. Both the TUV300 and KUV100 have helped us in terms of our objectives in growth,” says the President & Chief Executive, Automotive. The TUV300 was launched last September and over 30,000 units are on the road. The KUV100 followed in January this year and is averaging nearly 4,500 units each month. According to Shah, beyond Maruti and Hyundai, this is the only brand selling over 4,000 units in this space.

The idea of launching the KUV100 was to give people an opportunity to own their first SUV at an affordable price of ₹4.6 lakh. The strategy seems to have worked so far with nearly 55 per cent being first-time automobile buyers. Again, around 25 per cent are under the age of 25 which fits in with its objective of targeting youth.

The KUV100 also comes with a petrol option which already accounts for over 50 per cent of sales. It is likely that this component will grow even further in the coming months with the entire auto market now increasingly tilted towards petrol.

Interestingly, its six-seater option takes up a lion’s chunk of sales at over 80 per cent. Shah believes what is also working for the KUV100 is its array of accessible technologies. The choice of power or economy mode has also helped M&M broaden its customer base. “First time buyers test a host of vehicles and then make a decision which tells us that the KUV100 has hit the right note. It has also helped us with our entry into the petrol segment,” says Shah. The TUV300, in contrast, averages lower sales of 2,750 units per month which is line with what was targeted in the first place. This was the first compact SUV with AMT as an option. More importantly, these two vehicles have done what was expected of them in increasing M&M’s market share in SUVs last fiscal to 38 per cent. To break it up even further, this figure was 41 per cent in Q4 against 33 per cent in Q2 prior to the duo’s debut. Despite this turnaround, the fact remains that there is competitive pressure in the SUV space even while M&M remains the leader of the pack. For instance, both Maruti’s Vitara Brezza and Hyundai’s Creta have set sales charts afire and are growing from strength to strength.

In the process, M&M’s top-selling Bolero model has taken quite a hit with its numbers falling from the previous highs of nearly 8,000 units per month. Shah does not deny that rivals like Maruti and Hyundai have made their presence felt but believes all is not lost for Bolero either.

As he explains, rural India has been going through a lot of stress lately thanks to a combination of factors ranging from poor rains and crop failure to low farm incomes. “Bolero, being my king of rural and semi-urban markets, was impacted,” he says. Yet, things are a lot better this fiscal with the monsoons on time and the prospects for rural India brightening as a result.

“Going forward, you will hear our response though I cannot talk about that now. The resurrection of the Bolero brand is happening soon enough before the monsoon season gets out. Who knows the customer better than a homegrown company like ours?” asks Shah.

It is also his view that Bolero reflects the sentiment of the rural market. “Somebody should also find out Bolero’s resale value compared to other models. If Bolero has indeed fallen as some people say, why does it still command such high resale value? Wait and watch what the brand stands for,” adds Shah.

M&M’s rural penetration levels are 40 per cent now and the plan is to increase this further to 45 per cent by the end of this fiscal while pulling out all stops in sales and service. “We have a robust rural strategy in place and are a lot more ahead (of rivals). We are also moving at a brisk pace and others will take time to catch up with us,” says Shah.

What is especially comforting at this point in time is that M&M now has a SUV range starting from ₹4.6 lakh going all the way to ₹25 lakh, a portfolio that includes the KUV100, TUV300, NuvoSport, Bolero, Scorpio, XUV500 and Rexton.

Even better, says Shah, is the fact is that there is no cannibalisation among these products which means that each is in a niche of its own.

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