India auto giant Mahindra & Mahindra has announced a delay in the launch of its latest-generation XUV500 and the new Mahindra Thar off-roader. The vehicles are now expected to be launched during the third and fourth quarters of this year. The delay has been caused by the Covid-19 pandemic and the subsequent lockdown that followed.
According to ET Auto, the statement was made by Mr Veejay Nakra, the Chief Executive Officer at Mahindra & Mahindra's Auto Division. The company said that upsizing production capacity is a challenge because demand for vehicles has returned faster than anticipated.
Mr Nakra said, "We are struggling to manage supplies to ramp up capacity to meet the strong anticipated demand generating for our products and brands, especially from rural India."
"Customers are coming back to the showrooms and footfall at the dealerships has come to 40 percent of the pre-Covid times, while the inquiries are back to almost 75 percent of the pre-pandemic era," he added.
Mahindra says that stable supply lines will take roughly between 30 and 45 days to set up, should there be no additional lockdowns called for.
The brand also feels that subscription models and rural markets will register more sales during the crisis. The rural markets account for over 50 percent of Mahindra's total sales wherein the Bolero, the Scorpio, and the Jeeto remain top sellers.
The brand slipped to the third spot over the last few years as far as sales is concerned. Mahindra however insist that they are aiming for profitable growth and not only market share gains. The company will focus on the SUV segment and will offer a wider range of products over the foreseeable future.
Mr Nakra said, "M&M has always stood for being a strong and diverse SUV player, but digressed into new segments in the recent past, however demand for larger vehicles like MPVs and SUVs will increase to maintain social distancing in a chauffeur driven society."
The brand is also working towards localising production of some components that it imports from China in order to make their products 100 percent made in India. The manufacturer said that it would take between three and six months to localise components, resulting in some delay in launches of new products.
Thoughts About The Delay In Launches Of The Mahindra XUV500 And The New Mahindra Thar
Delays in launches were definitely expected due the disruption caused by the lockdown and the Covid-19 pandemic. We expect some vehicle launches to be delayed further because of the localisation processes that manufacturers have initiated.