M&M readies new Thar, Scorpio and W601

Some of M&M’s models

Mahindra & Mahindra, one of the top two Indian automakers, said it is nearing the end of a major capital expenditure cycle, and is poised to launch upgraded versions of its sports utility vehicles that will offer unmatched value compared to its rivals’ products.

It said it is nearing the end of heavy investments both under the hood and on upgrading the design of its major models.

Under the hood, the company has finished work on a new line-up of engines in three different categories — 1.2 liter, 1.5 liter and 2.0 — in both petrol and diesel.

As for its SUV models, company officials said it is putting the finishing touches on three upgraded SUVs — the new Thar, the next-generation Scorpio (also known as Z101) and a new SUV co-developed with Ford, known under the code name W601. It is conjectured that the next version of its relatively successful premium SUV, XUV500, will be based on the W601, which is also likely to be used by Ford.

Mahindra & Mahindra needs to make some aggressive moves in the market if it is to recapture its former status as India’s No.1 SUV maker — a title that was seized by India’s largest carmaker Maruti Suzuki with its lower-priced, more fuel-efficient models like Vitara Brezza.

Mahindra & Mahindra MD Pawan Goenka said his company is done with “all the nodes” of launching these three SUVs and leaving the phase of heavy development behind.

“..the big capex is getting over with the launch of the three products — the new Thar, the W601 and the Z101. We are done with the complete engine development. We have brand new diesel and brand new gasoline engines at three displacements.

“Nobody has a newer portfolio of diesel and gasoline engines as we do. Therefore, we don’t need to invest in core engine technology, we don’t need to invest in capacity for engines, we don’t need to invest in capacity for vehicles, we don’t need to invest in new platforms,” he said.

Much of M&M’s strategy relies on the work done jointly with US automaker Ford, with which it entered into an agreement to co-develop SUVs and engines in 2017 and 2018. Joint development is expected to save money for both automakers by sharing engines and models.

Separately, M&M was forced to upgrade its engine technology due to the introduction of the BS-VI emission standards in India from April 1 this year.

While the transition to the tighter emission standard was less of a challenge for largely petrol-oriented players like Maruti Suzuki, it has certainly been much more challenging for a diesel-focused player M&M.

It is much harder to design a diesel engine conforming to BS-VI standards than a petrol engine. Many automakers have simply decided to phase out all their diesel models in the 1.2 liter and lower capacity category, instead of trying to come up with small diesel engines that conform to the new standards.

M&M officials claimed it has finished work on a new line-up of engines in all the three engine sizes it operates in — 1.2 liter, 1.5 liter and 2.0 liter.

“The [new] 1.2 liter engine is used currently by [Korean subsidiary] Ssangyong for exports to Europe and to meet the CO2 requirement in Europe,” said a company official. “The 1.2 liter engine will also go into Ford Ecosport.”

The 1.5 liter engine is being used by Ssangyong Korando and will also go into the B platform SUV that Ford is developing for both Ford and Mahindra, he added.

B Platform, developed by Ford, refers to the underlying design of Ford Ecosport and will compete in the most competitive ‘B segment’ category of the Indian SUV market.

The SUV market is frequently divided into the A segment, which refers to very small SUVs, the B segment — which accounts for most of the models such as Ford Ecosport, Creta, Kia Seltos and MG Hector — the C segment, comprising the likes of Toyota C-HR, Honda CR-V and Hyundai Tucson — and the D segment.

The M&M official also added that the 2.0 liter engine developed by M&M has been accepted by Ford for the jointly developed W601 and W605 models. Both these models will belong to the premium C segment.

“Two of [the new engines] are therefore already in the market right now, and one of them has been accepted by Ford,” he pointed out.

The first of the two C segment SUVs planned by Ford in collaboration with M&M, codenamed 601, will be in the market by the end of this financial year [ending March 2021], he added.

On recapturing the title of India’s biggest SUV maker, Pawan Goenka said he was not overly worried about market share numbers for the SUV segment, as the segment also includes many models that are based on car platforms.

He said, thanks to the new line-up, M&M will have a “differentiated portfolio, compared to what most other people are going to come in with at the price points we will offer”.

M&M will offer petrol engines of up to 2.0 liter capacity, and these engines come with the Turbocharged Gasoline Direct Injection (TGDI) technology that increases fuel efficiency and lowers emissions.

About 15% of the buyers of XUV300 B-segment SUV go for the 1.2 liter petrol engine in place of the 1.5 liter diesel engine, according to M&M officials.