Mahindra & Mahindra (M&M) has developed an ambitious plan for the next six years for its automotive and agricultural equipment business as it seeks to enter the next phase of growth amid increased competition and disruption of new technologies and trends.
As part of the plan, the automaker plans to launch 13 new sport utility vehicles (SUVs) by 2027. This will include eight electric vehicles (EVs). By then, at least 20% of total SUV volumes come from electric vehicles, company executives said on a earnings conference call on Tuesday.
M&M will also have a new brand for electric SUVs (e-SUVs). Most upcoming internal combustion engine (ICE) models will have nicknames Bolero, Scorpio, Thar and XUV, said Rajesh Jejurikar, executive director of the automotive and agricultural sectors of the Mahindra Group. Of the eight new EV models, four will be purely electric, the rest will be the electrified version of the existing ICE models. Mahindra plans to invest Rs 3,000 crore in the electric vehicle sector through 2023-24. This includes the development of e-SUV, e-quadricycle and small and light electric utility vehicles. He envisions a total of 16 electric vehicle launches by 2027. Anish Shah, Managing Director and CEO, said: “M&M is now open to outside funding. “
Apart from Tata Motors, Mahindra is the only manufacturer in the mass segment to have set a target for penetration of electric vehicles. Mahindra, one of the early entrants to the EV space, had to overhaul its EV strategy after its EV models – first as Mahindra Reva and then as e2o – failed to advance due to the high cost of ownership, poor range and underdeveloped charging infrastructure. , and a lack of political leadership on the part of the government.
In August 2019, he unplugged the e2o – a four-door sedan based on the Reva platform – amid falling sales and tighter safety regulations.
Seizing the opportunity of white space and the increasing push for EVs by policymakers, Tata Motors launched the e-Nexon in January 2020. Since then, there has been no looking back for the. great rival of Mahindra.
Selling nearly 1,000 or more units of e-Nexon per month, Tata Motors now owns nearly 70 percent of the shares in the personal electric vehicle segment. Building on its success, it launched the redesigned e-Tigor last August. The flagship of the Tata group plans to have 10 electric vehicles in its portfolio by 2025. It recently raised 15,000 crore rupees for its EV arm.
“In India, local manufacturers are leading the charge for electric vehicles by launching affordable products and setting milestones. Multinationals are having a foot in the door launching high-end offerings, ”said Ravi Bhatia, President and CEO of JATO Dynamics, a global provider of automotive business intelligence headquartered in Uxbridge, London.
Meanwhile, the company envisions 10-fold growth for the agricultural machinery industry by 2027. It plans to achieve this by launching 15 products, exploring partnerships and alliances, and tripling its dealer network. by 2025 and installing manufacturing facilities in Pithampur in 2023.
M&M, excluding subsidiaries, reported net profit up several times for the July-September quarter. It rose to Rs 1,432 crore, up from Rs 162 crore a year ago. Its revenue for the quarter also increased 15% to Rs 13,305 crore, from Rs 11,590 crore in the corresponding period. However, high input costs shot up margins, lowering earnings before interest, taxes, depreciation and amortization by 19 percent.
“Commodity prices had an impact on our margins in the automotive and agricultural sector, but our focus on managing and optimizing costs helped mitigate some of the impact,” said Manoj Bhat , Chief Financial Officer of M&M.