After having introduced a leasing model for its retail buyers last year, Mahindra & Mahindra Ltd on Thursday announced the introduction of a subscription-based initiative, in partnership with Revv–a self-driving rental platform–for its retail customers, in a bid to offer a different usage model, which doesn’t necessarily involve ownership.

This initiative will attract a whole new set of customers to brand Mahindra, said Veejay Ram Nakra, Chief of Sales and Marketing, Automotive Division, Mahindra & Mahindra Ltd. It also aligns with M&M's larger vision of transforming the face of mobility in India, he added.

“With the changing era, (and) the millennials wanting to experience brands in different ways with avoiding long-term commitments - both in terms of time as well as and financial capital - we believe that it’s an appropriate time to look at convenience, flexibility and affordability as the three key pillars to drive ownership experience. A subscription model is something that, in a sense, addresses all these three needs of today,” Nakra told reporters in an interaction post the announcement.

He added that it’s not just the millennials, but also the self-employed, expatriates and mobile working forces who now seek flexibility in terms of owning high value assets like automobiles.

Vehicle portfolio

The subscription model will be available on Mahindra’s personal portfolio of vehicles, namely – KUV100, XUV500, XUV300, Scorpio, TUV300, Marazzo and Alturas G4. It will be available for a period of one to fouryears in the case of a new car.

“I don’t think this is a short-term intervention for a short-term slowdown in the automobile industry. There are structural shifts that are happening and in an environment of structural shifts, we need to have a robust strategy of offerings and this is something we have been working on for a long time. It’s just that from the timing of launch point of view, it seems to happen where it is right now.” said Nakra, to a question on whether this initiative was rolled out keeping in mind the current prolonged slowdown in the automobile industry.

Hyundai India had also partnered with Revv in March to provide its cars to customers on a subscription basis.

Mahindra’s subscription offer will cater to working professionals and SMEs and will be available across eight Indian cities including Delhi (NCR), Mumbai, Pune, Bangalore, Hyderabad, Kolkata, Chandigarh, Ahmedabad in the first phase. It plans to cater to 11 more cities in the next three months, said Nakra.

Subscription benefits

Mahindra’s offer begins at a subscription price starting from ₹19,720 per month (which can vary according to the model), inclusive of insurance and routine maintenance charges.

The benefits of subscription to the customers include complete convenience, zero down payments, no road tax, zero risk on the resale value of the vehicle, and a fixed amount that includes routine maintenance cost, the company said.

Nakra said, one has the flexibility to change the vehicle model after a certain minimum subscription period, and this flexibility to upgrade their models from time to time is what primarily differentiates it from a leasing model. Unlike the leasing model, it also allows customers to opt for a minimum of one year, as opposed to the 3-4 years that a leasing model necessitates.

Once the subscription period is over, the person can return the vehicle to the company without selling it, and get a new vehicle. Or they have the option of owning it, by buying it from the company at a pre-determined charge.

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