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Mahindra Invests Rs. 700 Crore in Commercial Vehicles and Expands Dealership Network

Mahindra & Mahindra has decided to invest Rs 700Crore in the segment of commercial vehicles to expand its business and become as a full-range manufacturer in the truck and bus segment across entire India auto market.  Two years back the sales of commercial vehicles is low as of declining mining sector but now the segment is picked-up and improving its demanding scenarios continuously in Industry. Mahindra is also moves with fast steps in the production capabilities by observing the demand and product-based developments.  In the part, the company delivered 1500th heavy truck in the market from the Chakan plant on August 26th, 2015.

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Mahindra Research Valley president and CE Rajan Wadhera said Mahindra has a great commitment in the commercial vehicle business as a reason we decided to invest on that.  The CV industry included low, medium, high-range products turned with a positive sign in last fiscal year. With this, the company is following some aggressive tips in production as well as profitability and continuously grown to become as a largest manufacturer in truck and buses segment.  Moreover, the company is planning to increase its network that will help to enlarge the business in domestic and global market with unique products. It is expanded dealership network to 80 3S from existed 66, authorised service centres to 173, assistance service points to 2516 and retail spares network to 2000.

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Mahindra & Mahindra included trucks and buses segment in its business from few years back and had three years to completely move on the segment.  The sales of the company also increased and posted 50 percent growth in the fiscal year of 2015 by selling 3500 vehicles. In addition, growth of the company was continued in the fiscal year of 2016. In the first quarter, the auto market was grown with an increase of 23 percent only through the medium and heavy trucks but Mahindra managed the market in the same segment with 32.33% growth by delivering 1000 units to customers. In the light commercial vehicle segment, the company sale is down by 2 percentage in the Q1 by selling 1429 units. 

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Trucks and Buses business of Mahindra entered in 2010, the company expected that Mahindra’s business was put a threat to Tata Motors and Ashok Leyland but it was posted loss of profit with sales of limited volumes.   After, Mahindra posted a turnover Rs. 100Crore approximately and marginal profit Rs. 2.28 Crore with merging of trucks segment. The buses and trucks business was posted loss of Rs. 920 Crore before merging with Mahindra. In light commercial vehicle segment, the company sold 1.25 lakh vehicles to the Indian customers.

Mahindra Truck and Bus Division MD & CEO, Nalin Mehta said almost 6,000 Indian customers are using Mahindra’s trucks in which more percentage of the products repurchased by the 30 percent of old customers.  We will pan to invest on commercial vehicle segment and definitely come with latest low and heavy volume vehicles.  The company sold 12, 148 commercial vehicles in July, FY16 with a growth of 7% than same period of last fiscal year.  Particularly in the M&HCV segment, company has 11% growth by selling 314 units in July (284-last fiscal July).

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Mahindra’s Commercial vehicle sales:

  July (Fiscal year 2015) July (Fiscal year 2016) % change
Commercial vehicles 11336 12418 7%
LCV<3.5T 10611 11230 6%
LCV>3.5T 441 604 37%
MHCV 284 314 11%


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Automotive Admin

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