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Mahindra & Mahindra is planning to create a new SUV segment with its next product scheduled to debut in the coming months.
The XUV 500, codenamed W 201, will fill the Rs 11-20 lakh price gap between the top-end Scorpio and the premium SUV space.
“We think that the Mahindra brand has evolved over the last decade and is now at a point where the buyer would not mind paying a little more for a product. There are enough customers who believe we can offer a product that can compete with the best in the world,” Dr Pawan Goenka, President, Automotive and Farm Equipment Sectors, told Business Line.
The reality is that there is no product upwards of Rs 11-lakh which sells by the thousands each month and this is the company's biggest challenge with the XUV 500. Dr Goenka is, however, not worried. “We did this with the Scorpio years ago and are confident that we can move the mainstream price a notch higher with the new product,” he said.
Flagship premium brand
The XUV 500 will now become M&M's flagship premium brand, taking over from the Scorpio which will become its iconic brand. The Bolero remains the ‘most favoured' brand and the Xylo the ‘most comfortable' vehicle.
The first locally developed monocoque SUV in the country, the XUV 500, was designed at M&M's R&D centre in Chennai. Plans are on to develop the next set of variants but this will begin after the vehicle is launched towards the end of this year.
It will roll out of the company's new Chakan plant near Pune which is soon scheduled to overtake Nashik (home to the Scorpio and Bolero) as M&M's largest vehicle producing facility. However, a decision on future investments could hinge on the long overdue VAT (value-added tax) refunds.
M&M will also use SsangYong's (which it acquired recently) global network for its own range of vehicles. The converse will also apply to the Korean automaker's vehicles which will be retailed through the Mahindra network. The duo will soon kick off joint retailing of their vehicles (including the XUV 500) in M&M showrooms in South Africa.
Dr Goenka, however, reiterated that there would be different retailing business models for each country while attempting to leverage the two brands. India will see SsangYong SUVs like the Rexton and Korando hit the roads soon though the top priority would be to ensure that there is no dilution of the Mahindra brand in the process.
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