Every quarter Mahindra & Mahindra is planning to launch one new variant and one new car with planning to increase its retail footprint all India significantly. Pravin Shah, President and Chief Executive (Automotive) Mahindra & Mahindra Ltd. unveiled his brand’s retail expansion plans at the launch of new version of XUV 500 in Mumbai.
What are your plans of increasing dealership centre’s across India?
Currently we are operating through 380 dealers and total 1500 touch points. We have laid expansion plans of increasing our dealership centres and touch points with launching of one new variant and one new fresh car’s every quarters.This means we are going to expand our product portfolio with which we are planning to launch more dealership centres and touch points in tier III and IV cities. We have a desire to meet the customer requirement of buying or servicing M&M automobiles within the radio of 20 to 25 km from his house.We don’t count the number and don’t chase the numbers in terms of networks. We have a framed policy about how we need to distribute and serve the customers.
Any annual target of dealership centre’s with franchising?
I can say that there will be growing number of dealership centre’s opening in the market. As I have said we don’t chase numbers, if you love the numbers then at some other time you have to chase closers. We do it with the viability.
What is the investment amount you are putting for expansion plans?
Investment amount varies with the format on which we are planning for expansion. As a policy we don’t add Mahindra owned dealership. We generally operate through franchise model so the investment number changes from model to model. I can say that we have much more value to offer associated with our brand considering the vast product portfolio in different segments.
What is your ratio of sale in rural and metro markets?
Presently our rural penetration is somewhere around 37 percent. Further we have plans of increasing our rural market share. Overall the M&M has very good rural presence. With the help of network expansion plans and existing network our rural penetration is increasing. Ratio of sale depends upon the need of the affordability and the need of the customer irrespective of the locations whether it’s a metro, rural or town. The XUV has the capability of taking on any roads and all will drive option surely we share much better performance from the other competitors.
In today’s time it will be fare to say the traditional segmentation in terms small cars, medium cars, big cars or SUVs has disappeared, what comes in the mind is what product has to offer, at what price points, at what type of experience one is expecting and these becomes the fair amount reasons on which people buying decision relies.
What’s your take on e-commerce five years down the line for promoting M&M?
With growing e-commerce and transition in consumer behavior and buying patterns we will undergo the change within five years.
In India we have deep routed offline retail sector association with customer psychology and behavior and with mass employment. So in the future we cannot predict the things. We need to reckon and we need to be constant of the facts.I see e-commerce as exploding but if you ask me then I will say every commercial organization has to stay with success. It not only per say auto industry the e-commerce is going to change the way we live and operate and transact. It’s changing by the day. Today it’s very difficult to say that e-commerce is a success. Yes, they are succeeding and we all have seen the benefits of that. But will these e-commerce market place service providers be profitably be existing on the basis of the valuation that they get? Time will the answer to the question.
Don’t you think M&Ms entry into the compact XUV segment is little bit late?
Yes, I have no hesitation in accepting that. But don’t forget the fact that people who define themselves as a part of SUVs must check that are they really SUVs. They should not only check based on the sales but the construction, the type of versatility for compact SUV - what one can expect from the compact SUV globally- do you get them or just these SUVs designed and made for substituting the fact. So I guess the consumer and the media need to judge and understand the fact much better.
How automotive industry is reviving from the sluggish growth last year?
With the economy exploring, prices are reducing and getting stabilised, and interest rates are likely to be softened. People are migrating and looking for the different type of product stores. So, with this we see that there is a scope for the XUVs and automobile industry to grow. Currently, YOY the industry is growing by five percent.
What is your market share of SUV and XUV?
The entire SUV segment is of over a half million cars and we are the market leader in SUVs with 54 percent market share. And in XUV we are still at nascent stage and trying to capture the large market share.
What is your monthly sale of XUVs?
Our monthly sale of XUV is of 3000 and we are expecting it to grow attractively.
What is the price range of XUV 500?
XUV 500 is offered into four ranges that is W4, W6, W8 and W10 at the price range of Rs 11.2 lakh, Rs 12.31 lakh, Rs 14.0 lakh and Rs 14.82 lakh respectively.