Mahindra & Mahindra to roll out 4 SUVs, invest Rs 5,000 crore

NEW DELHI: Mahindra & Mahindra (M&M) is in race for a $6 billion order from the US government for postal delivery vehicles, and will submit over a dozen prototypes for road-testing between September and November this year as the process enters its final round.

“The work is at an advanced stage, and we got an $11 million prototype contract from the government. The prototypes have been built in Detroit. While eight of these will be delivered in September, another six will be sent in November,” Rick Haas, president and CEO of Mahindra Automotive North America (MANA), told TOI in New York recently.

M&M is competing with four other companies for this high-value contract. They are -AM General (US company that supplies high-quality specialized vehicles for military and commercial), VT Hackney (manufactures specialised truck bodies and trailers), Karsan (Turkish CV maker) and Oshkosh Corporation (US company that builds specialty trucks and military vehicles). If approved, M&M will be required to provide 1.8 lakh vehicles over a six-year period as the postal department liquidates its old fleet. While the per vehicle cost is expected to be over $35,000, the company also hopes to gain from the maintenance and repair contract. Diversified Mahindra group has an over $2 billion business in the US. The vehicles will have to be made in the US as per the conditions stipulated in the tender.

“The contract will be decided over the next one year, and we are confident about our prospects,” Haas said, adding that companies such as Ford, Nissan and Mercedes had also pitched in the initial phase (they are out of race now). “If we win, the deliveries will need to start from 2019, or by 2020.”

He said the order may go to a single vendor, or “might be to two suppliers.” Mahindra & Mahindra has decided to go on an overdrive to protect its turf in the SUV and utility vehicles space and will pump in Rs 5,000 crore for bringing out four new off-roaders, including two from a new global platform.

Pawan Goenka, MD of the domestic UV major, told TOI that the first vehicle to hit the roads will be a new 7seater multi-purpose (MPV) that will be an Innova competitor. “This is at an advanced stage, and it is codenamed ‘S321’ internally.”

The next vehicle will come out in 2018-19 and this is based on the company’s Korean subsidiary Ssangyong’s Tivoli SUV. “It is codenamed the S201 and will be a 5-seater,” Goenka said. The vehicle is expected to sport the Mahindra badging at launch, and is expected to add the much-wanted refinement and finesse to the company’s line-up. Goenka said that work on the “global platform” is at an advanced stage, and one of the SUVs from the platform is aimed at international markets. “We expect to drive this one out by 2020, and it will be a premium vehicle. It could be headed to the Euro pean markets and those in other regions.”

The other product from the new platform will be targeted at home market India and will hit the road by 2021.

The company’s grip in the UV category has been challenged by a host of carmakers, which include Renault, Hyundai, Maruti-Suzuki and now Jeep. Goenka said that Mahindra is mindful of the challenge and is now taking aggressive steps to protect its market share. “We are looking at an overall growth in the passenger vehicles category, and the new products are aimed at strengthening our position.”

It is expected that the company will dig into its overseas product development teams during the making of the new vehicles.These will include the technical centre in the US.


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