ETAuto BigByte with Rajan Wadhera, Mahindra & Mahindra’s Automotive Sector President

ETAuto BigByte with Rajan Wadhera, Mahindra & Mahindra’s Automotive Sector President


press the Pelican and never miss an update committee odo [Applause] hello and welcome to et Auto Big Bite assure that brings top executives from automotive industry I am Nabila Han and I have here with me mr. Rajan vedera president Mahindra and main the automotive division welcome to ET auto big whites today you have a real fight products in I CV segment this is one of the fastest growing segments what is your edge endure for commercial vehicle going forward you are going to be profitable this year that’s what you have said what is the view you have said that 21 products you are going to launch in next one or one and a half years so just took corrective in the automotive sector we have automotive division and we have the truck and the bus division so as automotive sector we are number two in the commercial vehicle a very strong number one in the small commercial vehicle range and then we try to develop the hcv trucks range we way back we launched it in 2011 and then of course we had another fresh version of the heavy commercial vehicle which was branded as blazer the most fuel-efficient truck which last three years we have doubled market share based on some very good value proposition that the product offers to its users so having done that when we look at our complete range of the commercial vehicle we were not present in this 7 to 16 cast range which is the ICV and the MCV range we are there in LTV wave number three small commercial vehicle be a number one MC then it’s V even number four so all over if you look at end to end we are number two so you are trying to from now we are trying to get into the IC village in the ICV range four years back we started work on it we committed as you know six hundred crores for developing this platform which is very modular there are three cabins four engines two gearboxes which will develop lemon done 12 ton 30 done 14 done heavy-duty 16 done 15 done and also on the lower side 7 thumb vehicles today you saw 11 12 13 and 14 10 vehicles by the end of the year we will also launch 15 and 16 tap and then next year end of the first quarter we will launch a 7-ton vehicle with this there is an industry of about hundred and fifty thousand units this space we were not there earlier so if we have to be a complete range player which we should be which we decided four years back that’s all we committed ourselves to the development of the entire ICD black so what percentage of your total sales you expect to come from ICV segment which you are going to now get into like so it will be sizable one because this this is a 150 thousand market and heavy commercial vehicle market the way it is growing also likely to be two hundred thousand plus one hundred and fifty thousand of this and then on the small commercial vehicle size you you know market is very big another close to two hundred thousand units we sell there so it becomes a very big market for us so you have plans to launch CNG variants also what kind of opportunity you see in that in which variants CNG variant variance so CNG is a essential requirement in certain markets so but natural that we have a CNG variant it’s more regulatory also and wherever CNG is available and it is regulated therefore you have to have a CNG variant and which we already have but this as talking of the ICV range this range is important for us because it is going to add to our numbers it is going to add to our market share is also going to add to the profitability of our channel partners as well as the entire truck and bus division you are focusing more on commercial vehicle we coming back to passenger vehicles we have seen a lot of product launches happen in the last two and a half years three years but many of them did not see a very good response what has been the reason have you done some kind of introspection some kind of thought process has gone into and what is going to be the next level of action I think it’s a continuous activity product development is is it’s not necessary that everything you launch will be successful we have learnt our lessons and those lessons will be helpful going forward in the other launches that we have there are some specific products for specific markets I’m sure you’re talking of I know what you’re talking of KUB and tuv we have our successes there also but overall yes market share numbers it has not given us but the new we are looking forward to our new launches to get those numbers so how many new launches you have planned so we have three launches planned in the next I would say complete at the end of the year we would have launched three new SUVs and an MPV that we are launching totally three products are coming we have seen that your Ssangyong you know collaboration is not much reflecting in the Indian market you have one product only you are probably bringing one more product so what is the future plan for that segment there’s a lot of competition so you need to have a larger offering in that space there was a time when there were less competition you did well but as the competition started coming up you know you lost your number one position in utility vehicle so how Ssangyong is going to be helping you in that so over one of the SUVs that is coming is coming on a joint platform so it’s a Ssangyong Tivoli platform on which we will be launching our SUV so that helps you if you share a platform your costs on the load side it’s a fairly highly developed platform well engineered working very well in sanghya so we have adopted that platform in India another new platform that we are developing you’re going to develop jointly so synergies will flow one of the products that we’ll be launching the the g4 version of the erstwhile gangster is a completely new platform which will come from sanghya and that will also be launched in two to three months from now this utility may kill some of them as you also mentioned that did not work out have you done some kind of deep diving and what went wrong and how are you going to correct that some claim that the pricing versus product was I’m not gonna tell you in public I what all of you have learnt but still some of the Pointer your thing do you think I think I think everybody learns and it’s not necessary that you are 100% successful in every launch world over nobody has is successful with every product and I don’t want to name there are all kinds of OMS we have not had 100% success I think we should have the humility of accepting and learning and blowing that information into new products so let’s wait and what so when do we see my end i again coming on the top when it comes to you to see there have been the many many new entrants obviously if new entrants come the those who are they’re already entrenched they will lose market share it’s very obvious the definition of SUV has changed we are largely frame based suvs so the new ones that are coming are coming with the monocoque so the entire segment you can’t really call it the real SUV segment so the definition has changed and I think we will also find our place in the market share you’re rubbing it in great get all the very best for you you also talked about today commercial vehicle business becoming you know profitable from this year what has really helped you key strategy that turned the corner okay I think our key strategy has been focused on the product give a value in the commercial vehicle business customer is looking at at the end of it it is a business for him therefore in his value proposition it has to make business sense for him and our fuel efficiency makes sense for him we have given guarantee your own fuel efficiency so blaze au has been well accepted a truck for its fuel efficiency consequent to which our numbers have doubled in the last one year we have growing in the blaze of space in three years our market share has doubled so with the volumes coming in and if it’s a good product you need not discount it and we have a fixed price of glazier consequently we have good financials has exports also played a key role in this in terms of helping you get profitable exports has been one of the key know in the Indra truck and bus division for HCV we are exporting very little very little to Nepal largely and how how do you look at going forward do you want to expand that yeah we are looking at expanding export with I see me coming up your ICV and at CV also be looking at some more markets you have seeded our every commercial vehicle in those markets so how much you expect to export next from next year onwards I would not like to put a number but I think our numbers are growing so what kind of investment plan you have for commercial vehicle and passenger vehicle commercial vehicle is on a roll but for passenger vehicle to beef up their efforts to be number one again so what kind of investments we have already announced the investments we have there will be all new XUV all new copy of all youth are all new platforms will get typically 10 to 15 years you can run a platform after that time it is required that you come with the new platform you have already committed ourselves to new platforms anybody commits theirselves you cannot have the same product continue for more than a decade so we’ve already committed ourselves to new platforms in all our brands there’s a lot of policy change happening at a commercial vehicle side the descent announcement of axle load you know that they have increased it by 25 to 30 percent almost legalizing overweight if we talk about you know if they allow it on the existing products as well so how do you see this so if they allow it on the existing one and it happens I think there is a growth that is coming so that there is a load that is growing whether it is infrastructure whether it is all-round economic development so the load is going to grow and it is anybody’s guess what happens to the growth rate if it becomes a fully legal and it’s little too early to make any guess or make any announcement on the impact term I think it’s just few days back only this has come however if one has to start making vehicles to the new load norms it takes time you know because load is taken by tires there’s a steering effort there’s a braking effort if one has to design to the new norms it takes time and right now I think everybody is very busy working on bsx development so as a sign body we have requested the government that if the applicability of this for the new products could be put along with be a 6-bit reduction okay that a little bit so right now the government has not given any clarity probably it is going to be on new vehicle or the older vehicles cannot yes I think so not much clarity that is also coming back to the overall industry performance last two months has been good we have seen a strong double-digit growth how do you look at the year financially or 18 19 for commercial vehicle passenger vehicle and overall auto industry I think the overall auto industry will grow commercial vehicle will grow faster than passenger vehicle at CBS growing LTVs growing ITV’s growing small commercial vehicle industry is growing I think the all-round activity of infrastructure development other activity which is in general increase of the economic activity will definitely give a boost to commercial vehicle so can you put a number like earlier sciama has projected it to 10% for passenger vehicle you you think will be able to surpass that buts in your vehicle I think it’ll be around the same okay for commercial vehicle whatever commercial because I think we’re talking of a double-digit growth twenty percent of the kind of the growth do you think that the in commercial vehicle a bit of growth has come from because of the performant of this new body building code that is happening across various estates because people are buying in advance in fear that the price may go up after that body building regulation comes up I think there is always an interplay or some of these things but there could be various factors for growth I think this could be one of the reasons what you are saying but largely I think it is the admission norms I think the bs6 norms when they’ll come then and comes with the increased price so people are trying to replace those who have a ps3 would not want to replace it with a BS six it’ll be too expensive they’re probably trying to replace it with the BS four so that at the BS six they’re probably one a mission behind not to level of mission behind so I think even that is driving the growth people want to change the BS three trucks to be a sport truck so in next 2-3 years will say see probably slowdown in commercial vehicle this you four-eyes but so it’s a it’s a it’s a function of the all-round business development in the country the growth of the country because commercial vehicles they represent the growth of the country the growth of the country is their commercial vehicle will grow so GST has been again revised and a lot of thing has GST has been reduced do you think it will bring for the liquidity into the market and you think it will add to the automotive industry also yes I think so I think in some sectors where the it has come down from 28 to 18 percent it should end if we look at the overall industry what kind of job creation investment you see for this financially FY 18 in 19 in automotive industry if there are pinpoint what are those and what are the positive that you see but typically what happens is you know last four or five years in the commercial vehicle space capacity has been idling most of the commercial vehicle manufacturers were at fifty to sixty percent of the installed capacity I think it’s inching up we’re probably at levels of 80 to 90 percent of the installed capacity and if the installed capacity is getting consistently used over the next six to eight months time will come where new investments will start kicking in for capacity expansions in commercial rise in commercial vehicles if that happens then definitely job creation will happen now what about the passenger and tovahleh send a two-wheeler is growing at constant eight to ten percent so that will also invite investments and there will be growth there also we have capacity utilization I think right know capacity is almost I think eighty to ninety percent being used thank you so much for being so candid and good at answering all the questions welcome to it your tones thank you thank you very much [Applause]


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