Mahindra enters 2021 by breaking off the JV with Ford but is still open to collaboration with the American automaker
Mahindra & Mahindra ended the challenging year with overall auto sector sales of 35,187 units (passenger vehicles, commercial vehicles and exports) in December 2020 as against 39,230 units in December 2019. While the UV segment registered marginal YoY growth, the commercial vehicle and car segments continue to witness the slowdown.
Mahindra sales – December 2020
Mahindra sold 16,050 units of utility vehicles last month which represents a YoY growth of 5%. However, the car sales, mostly contributed by the brand’s electric vehicle division, plummeted by 72% compared to December 2019 to mere 166 units. The overall passenger vehicle segment (UVs + cars) make for a 3% YoY growth.
Speaking about the lackluster sales performance, Veejay Nakra, CEO of M&M’s automotive division, stated that the company has been affected by the continuing supply chain challenges due to the constantly changing global environment.
He added that the Mahindra has been facing supply shortage of microprocessors that go into the ECU. This could be one of the reasons for the new Mahindra Thar’s waiting period stretching to over 10 months for select variants. Mahindra says that demand has been strong since the festive season and is expected to remain so in the new year.
When it comes to commercial vehicle sales, every sub-segment registered significant negative YoY growth in December 2020. Mahindra sold 1,989 units of sub-2T LCVs (-43%), 11,400 units of 2T – 3.5T LCVs (-2%) and 541 units of LCV 3.5T+ and MHCVs (-47%). Exports witnessed a marginal improvement of 3% December 2020 with 2,210 units shipped overseas.
Mahindra Farm Equipment sales – December 2020
The automaker’s Farm Equipment division fared much better in December 2020 compared to the Automotive Division. Mahindra sold 21,173 units of tractors in the domestic market at a YoY growth of 23% while exports grew by 60% at 1,244 units. The overall growth stood at 25% with 17,991 units on the chart.
Mahindra Ford JV is a no go
Mahindra steps into 2021 by breaking off the JV which was announced with Ford last year. According to both entities, the decision to call off the partnership is due to fundamental changes in global economic and business conditions. Mahindra feels that it should stick to its core specialty of rugged SUVs rather than car-derived softroaders. Though the JV is broken up, Mahindra hints at exploring other collaborations with Ford. For example, the platform sharing and engine supply arrangements are likely to go ahead.
The new XUV500-based Ford C-SUV is likely to be contract manufactured by Mahindra. The Indian UV specialist is also likely to supply its new 1.2-liter turbocharged petrol engine to Ford for use in its next generation EcoSport mini SUV.