Mahindra & Mahindra | Planning To Move On From A Waning Power Towards Resurgence

When the LPG reforms were put to effect in 1991, M & M, like any other Indian company, suffered a blow to its stronghold in their market share. Although in Mahindra’s case, the decline in its market domination has been both sudden and gradual. 

Since the time it started manufacturing MUV’s under the Willy’s Jeep Line, Mahindra had enjoyed unprecedented success. That is, until recent times. In the last quarter of a decade, Mahindra’s market share has been challenged by both new and old entrants in the Indian automotive industry. While staving off competition from domestic competitors like Ashok Leyland and Tata Motors, Mahindra also needs to keep a wary eye on foreign companies like Range Rover.

Mahindra’s Scorpio achieved cult status amongst the Indian UV drivers, and the Bolero was no exception. However, even this wasn’t enough to ensure Mahindra’s oligopolistic bastion in the SUV industry.  With Ford, Maruti and Toyota rolling out new models, the SUV war has commenced; and Mahindra could well be its first casualty.  Even Renault, with whom Mahindra launched the Verito, is challenging Mahindra for market share.



When Audi sold out all of its 500 Q3 compact units, it was a cause for concern for all the major players in the SUV industry.  Ford’s EcoSport, Tata’s Safari Storm, the BMW X3 have all recorded astounding sales. But the Renault Duster has outclassed all competition. Gaining unanimous praise amongst buyers and critics alike, the Duster rules the roost undisputedly. The Ford EcoSport would arguably rank second; Priced between Rs. 5.8 lakhs to Rs. 9.3 lakhs, it is available in six petrol and four diesel versions.




Another chart given below tracks Mahindra’s performance (April 2015)  relation to its competitors,


Talking specifically of the UV segment it contributes 60-65% to the company's overall revenues and it is here that the company's market share during FY15 declined to 37.4%, from 47% a year back.

With consistently under-performing statistics and decreased share prices, Mahindra have a daunting task ahead of them, if they are to regain their once-formidable reputation in the Indian automotive industry.

Reasons for optimism
One major segment in which it has its absence is the sports utility vehicle segment. However, the company reportedly has new cheaper form of SUVs lined up, something on the lines of Suzuki Ertiga, Honda Mobillo. Given the advantage which M&M in terms of its superior dealer network and service delivery, auto analysts believe that once it launches new SUVs it would stand a good chance of recovering the market and match the sales of Renault Duster and Honda Mobillo. In addition to this, M&M is also expected to launch new variants of Bolero, XUV 500 by third quarter of FY15.

Another important factor is the ‘SsangYong factor’ which is expected to drive M&M’s long term business sustainablity with its global reach and assist them in terms of product development. It recently had a successful launch of Tivoli, a compact SUV which would portend a positive recite for M&M.

Therefore as M&M plans to collide head on with the market leaders like Hyundai and Maruti in the compact UV segment, where M&M has been a weak player, these new launches are expected to be a huge stepping stone for M&M in reviving their business in the UV segment.

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About SOHAM KADAM

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