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Mahindra & Mahindra Exports Drop 27%, Utility Vehicles Sales Down 8.6%


Mahindra & Mahindra Exports Drop 27%, Utility Vehicles Sales Down 8.6%
We bring you our monthly report on the automobile sales for the month of January, 2017. You can catch all the January Sales here. You can also find all the coverage in relation to the automobile sector here.

Having sold over 42,000 units of the KUV100, M&M launched the 1st anniversary edition of the model in top end K8 variant for Rs. 6.37 Lakh. This was followed by the launch of the new variant of XUV500.
Pravin Shah, President & Chief Executive (Automotive), M&M said:

In the first anniversary of KUV100, we would like to thank our customers for their support in creating a new SUV segment. The KUV100 has the appeal of an SUV and the practicality of a compact car, making it a compelling value proposition. At Mahindra, we constantly update our products in keeping with the latest trends. We have introduced the new avatar of the KUV100 with dual tone exterior colour, sporty and premium black interiors and bigger dynamic design alloys wheels along with various accessory kits. We are confident that it will further build on the KUV100’s style quotient and make it a popular choice amongst the youth.

Mahindra & Mahindra Exports Drop 27%, Utility Vehicles Sales Down 8.6%
During the month, Sona Group acquired 37.5% shares held by M&M in the JV (manufactures clutches and propeller shafts for SUVs and light commercial vehicles) for Rs 120 crore. Sona Group promoters will now own more than 70% of the company that supplies components to Ashok Leyland, Tata Motors, M&M, Eicher, JCB and US-based Meritor. Additionally M&M also plans to sell a minority stake in its subsidiary Mahindra Agri Solutions so as to raise Rs 300 crore.
Here is Dr. Pawan Goenka sharing the impact of demonetization and also talks about the regulations that kick in:

  • Underestimated the cash dependence on economy.
  • The industry that we are working in – the automotive and the tractor – the impact has been a little bigger than what we had expected.
  • The problem is not so much in new tractor sales, problem is in old tractor sales and that is part of the ecosystem. We look at new tractor, but old tractor is 100 percent cash and that is what is slowing us down.
  • In auto, it will be a little bit longer. Towards the end of the financial year, we should be more or less back to normal.
  • Investment in real estate slowed down because real estate had a very high element of unaccounted for money unfortunately. That perhaps is a sector that is biggest impacted by demonetization.
  • Launch of petrol variants is on schedule, will happen. The major launch, the big launch that we have next year is product that is codenamed U321. Then the major next launch which happens is what we call S201 which is a product that is based on most successful product of Ssangyong.
  • Major focus is into product development so as to meet the safety regulations that kick in for old vehicles in October, 2017 and 2019. Then the BS-VI emission norms that come in, in April, 2020 which is a very big deal for us.
  • On 2 Wheelers: We need to be in is a niche segment of premium bikes and premium scooters perhaps. We have purchased two brands BSA and we are developing right now bikes that will be under that brand.

You can also catch the group’s Chairman, Anand Mahindra as he talks about ride-sharing, autonomous vehicles and his social media persona that’s influencing the group’s culture.
M&M reported sales of 36,363 units in December, 2016 against 37,915 units during the same time last year resulting in a contraction of 4.1%.
Mahindra & Mahindra Exports Drop 27%, Utility Vehicles Sales Down 8.6%

  • Domestic Sales stood at 37,042 units against 40,693 units resulting in a contraction of 9%
  • Exports stood at 2,261 units against 3,096 units resulting in a contraction of 27%

Mahindra & Mahindra Exports Drop 27%, Utility Vehicles Sales Down 8.6%
Note: Sales numbers presented here are manufacturer reported sales numbers i.e. factory dispatches to dealerships. They are NOT retail sales figures to end customers.
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