So, we are here to talk about everything that's happening at Mahindra and it's certainly a topic that gets everybody's attention. And I'm joined now by Rajesh Jejurikar. It's great to see you. It's always
Hi yes, it's good to see you, too. Thank
I know I'm thrilled that you said yes, so appreciate it. It's been a string of successes, of course, but with that also comes that pressure of keeping it going. How do you view your current position?
We always have this conversation internally on the external world pressures of expectations because expectations creates its own set of opportunities and challenges. We deal with that by staying very focused on what we started off with as our vision or our target. So, we focus the conversation on SUVs. The first thing was staying focused and saying SUVs is the space we want to play in and we should stand for something. The metric should be SUV revenue market share, and we shouldn't be just playing a volume game. Volume is important, but we want to measure ourselves by being number one on SUV revenue market share. We still want to stay true to that metric because we don't want to start making decisions based on where volume lies. There are many segments with volume, but we don't necessarily want to play there if it doesn't fit our brand or we don't have a right to win or there isn't enough profit pool. The choices on what makes business sense and fits our brand is what we stay true to. I'm sure you'll come to the fact that we were volume number one passenger vehicle company last year. It's not our goal. It's nice to be there.
Yeah, it's nice to be there. So, in doing the right things, if we end up there, that's great. But we don't want to do the wrong things and play segments in which we shouldn't be playing because we either don't have a right to win or there isn't a profit pool. And start getting products out in segments that will take our brand in the opposite direction. So, it's nice to be number two passenger vehicle by volume, but really the goal is to be number one SUV revenue market share.
And that's a distinction. I mean, it's a distinction very often that people on my side of the fence also tend to miss.
Because it's very easy to go with number two in the market, number four in the market, whatever. That position has been talked about plenty over the last few months and credit to all of you because I don't think anybody saw it coming, to be fair.
Uh, when you say you don't want to necessarily look at segments that aren't core to your strategy, subcompact SUV for one, a lot of people keep asking. You're right. That's where a lot of the volume comes for certain other players like Tata, Maruti. Is that the correct way to interpret this, that it doesn't make sense for a brand like Mahindra to go there?
We are actually in subcompact SUV.
Well, yes, you are, but you know what I'm getting at, the really sort of entry level
Yeah, that's what people call the micro SUVs.
You used to have a product there.
We had a KUV 100. Yeah. If that's what you're referring to. And that's a lesson learned. If we have to create a product which does not represent the Mahindra brand DNA, then should we be doing it? KUV100 was a product which didn't represent who we stand for. It didn't have the unmissable presence, the aura, the ground clearance, or a head-turning design. So we really want all of these things which are part of the Mahindra DNA to be represented in the products we bring out. So, we are not in compact SUV because we have Bolero which is less than 4m, Thar three-door less than 4m, and the three XUV. So we actually have a portfolio and reasonable amount of our volume comes out of these three products. It's not that we don't want to do compact SUVs. It's whatever we do, it should represent the brand and should have a reasonable profit pool.
When you had this massive revolution with your EVs, so much has been said about that. The part which gets missed or forgotten is if you're comparing with other brands who are trying to do something similar, they had decades of R&D and presence in so many markets and larger assets at their disposal. Yet you had to do it in a way that you still compete with the best. So you went to top-tier suppliers. You put your heart and soul into those cars and it's very evident. Were you surprised by the reaction? I'm sure you had certain expectations, but this has surpassed those, I'm guessing.
Yes, firstly, we did put our heart and soul into it. It was making a statement and pushing the brand to a much more aspirational level. We wanted to do something on the cutting edge of design, technology, including software capability. We had to create new electronic architecture. There were many firsts for us. Velu and his team put everything behind it with passion and collaboration. The organization was willing to make a bet before the category evolved. We adopted a platform strategy with a roadmap for multiple products, which gave us scale. We entered the market with the goal to transform lifestyle, not sell the EV story initially. We focused on lifestyle and tech. Now we are moving to the benefits of EV. Were we surprised? Not surprised, but humbled and happy.
Um, if you look at the current landscape, there is so much happening constantly, especially on the EV side. There's lots of new innovation. We're still fairly young in terms of how many kinds of vehicles you have. Interestingly though, you didn't go with that derived platform strategy, which could have been quicker, maybe cheaper. But now you've also attracted a different kind of attention, not just a different kind of buyer. Is it a coincidence, or can you look back and tell us that this lifestyle aspect with the EVs was also happening on the other side with the ICE cars? I mean, what we've seen with Thar, with 7X0, it's also lifestyle.
It's consistent, and that's why I was saying that whatever we do with our portfolio has to be true to what the brand stands for. The brand we were creating for SUVs was about authentic SUVs, which are lifestyle statements, stand-out design, sustainable performance, speed. We wanted to carry those brand characteristics into the EV portfolio. It wasn't about creating a functional, economy-driven electric portfolio. It was about carrying the same brand values through, and that's the consistency between ICE and EV.
The second point was about if you go back to that point where I can't imagine being in that boardroom where you're saying this audacious plan. Hats off that you were able to push that through. But at that time, the expectation from where the world thought EVs were going and where we are today, there's a slight difference. Today people understand EVs better, but in many other markets the opportunity has shrunk or cracked. Do you feel now that in India we're still really well placed to carry on seeing this grow and build?
I think we are at a very good inflection point right now in India. One of the things that worked very well for us was going in with a 79 kWh battery. From an economical point of view, some might question adding so much cost, but it played out well because it gave reassurance on the range, which would have been the biggest barrier. With a real-world 500 km range in a country like India where average speeds and monthly driving are lower, it's a huge paradigm shift. Charging a couple of times a month instead of a week takes away range anxiety. Not introducing a 59 kWh version initially helped build good word of mouth on range. Today, range is not a concern for many of our customers.
I don't know when it comes to putting on the critic hat now because you hear these things. Have you put all your eggs into that one basket at a time when maybe the EV picture is cracking? There seems to be a lot of murmured last year which turned into a bit of a clamor now about hybrids. How are you safeguarding against that and how much does it worry you that this could become a shift in consumer mind?
Yeah, so the first is we don't know
Conventional hybrid. I'm not talking about PHEV.
Yeah. So, we are not a pure EV player. We are making as much investments in the ICE side. On hybrid specifically, we've always said that when there is a demand and our customers expect hybrids, we will have hybrids available for segments that need it. The hybrid noise has been on for the last 3 years, but look at the penetration. EV penetration for us in the last 3-4 months crossed 10% of our portfolio within 12 months of launch. The category EV penetration is now 7%, which was 1.5% a year back. Hybrid is expensive to customers, and unless they have a very high fuel efficiency need, it doesn't make sense to pay the premium at purchase. We compare it to the diesel versus petrol analogy. Our customers are not that fuel efficiency sensitive. So hybrids may be needed in some segments, but it's not the core of our strategy.
And how are you viewing all this noise around flex fuel? Because to be fair, you have to decide where your R&D dollars are going.
Yeah, I think flex fuel is an extension of an ICE strategy and that's something we will have options ready.
But this talk about now also blending diesel. Again, for you, diesel is still really key and very crucial. How much does that worry you? Because it's also going to affect existing vehicles on the road.
Um, how much does that worry you?
I'm sure the government will be sensitive to any change and the impact on quality of existing vehicles. At least I don't see diesel blending happening for a while because there are a large number of vehicles, not just passenger but commercial, that use the same pumps. You cannot have something that impacts the existing car park on quality.
Your customers, your dealers, Rajesh, what are they saying about diesel? How do you feel about diesel in the mid to long term?
From a customer demand point of view.
And just how much you want to stay with it because there are many who would have us believe diesel is dying a quick death, not a slow death.
