With a commitment of over Rs 10,000 crore for its electric vehicle business, Mahindra & Mahindra has not lost sight of its bread and butter models and has big plans to reinforce its internal combustion engine portfolio as well for the coming decade. A detailed investment plan and product portfolio is likely to revealed in the coming year.
M&M which reignited the brand with the Thar, XUV and Scorpio nameplates over the last few years, is readying itself with the new generation of its old Warhorse Bolero with a next generation architecture called U171 which could call for an investment in excess of Rs 2000 crore in the coming decade.
The new U171 internal combustion engine platform is likely to spawn over half a dozen different top hats, including SUVs and pickup trucks in the future. There are likely to be at least three SUVs on the platform, which could bring M&M an annual volume of about 1.5 lakh units. Once the pick-up range transitions on this platform, the volume potential could eventually double. The first model on the platform is likely to be on the roads in 2026-2027.
One of the several people in the know said, “This is a core platform that will help Mahindra protect its loyal customer base in the hinterlands and commercial vehicle buyers. That platform has always been very profitable and has silently delivered more volumes than planned. While the XUVs, Thar and Scorpio have caught the fancy of urban buyers, the new Bolero aims to raise the bar and re-ignite its position in the smaller towns and cities.”
Prior to the success of XUV 700, Thar and Scorpio N, if there was one model franchise that kept profits healthy was Bolero. The brand which has been on the radar of being axed in the storied history of over two decades, continues to enjoy strong loyalty especially in the Central and North belt of India.
For Mahindra, this brand has gotten better with time.
The Bolero family of SUVs continues to do an average of 8000 to 9000 units a month and accounts for 20 percent of the company’s total sales, and the profit share is likely to be much higher than the volumes. The pick up truck on the Bolero platform also brings in significant volume – and has been a linchpin of the M&M brand, accounting for a dominant share of over 60 percent in this segment.
An email sent to Bolero is yet to elicit any response on official queries pertaining to the all new Bolero.
To be sure, Rajesh Jejurikar, ED and CEO, Auto and Farm sectors, Mahindra & Mahindra, had informed analysts that the company will share the internal combustion engine plan in the next cycle of investment which is likely to be announced in the next three to six months.
“We want to really assure you that we are doing enough on the internal combustion engine to make sure, our products remain robust, refreshes are done periodically and there are completely new updates being planned. There are things in the pipeline, there is adequate and more than adequate focus on the ICE vehicles for future,” Jejurikar stated.
He explained that even if the penetration of electric vehicles were to reach 30 percent in the next 3-5 years, there will still be a very large percentage of the market that is 70 percent which will be in “internal combustion engine” space.
“So, clearly for us that is as important, we have to fortify our position of strength. Hence a lot of the manufacturing capacities are going to be fungible; we will be able to use it in Chakan, while there may be specific investment like the body shop, but we are creating fungibility with EV to some extent,” Jejurikar had told analysts in November.
Apart from the all new Bolero, the company will be introducing the facelifted XUV 300 in the calendar year 2024, followed by a five door Thar in the second half of next year.
To be sure, 99% of its 2.86 lakh booking is on the internal combustion engine side, led by its XUV 700, Scorpio N, Scorpio Classic and Thar.