The SUV maker will be hoping that the ongoing production bottlenecks will clear in the new year so that it can cater to its huge pile of pending orders
With order backlogs exceeding over 1 lakh units, India’s UV specialist Mahindra & Mahindra has its work cut out for the new year. The new Mahindra Thar and XUV700, both launched in 2021 went on to become huge hits in the market but the automaker’s capability to meet the demand has been heavily hampered by the ongoing global semi-conductor part shortage.
Despite this handicap, Mahindra & Mahindra managed to see off 2021 with a 11% YoY growth in December sales. Other Mahindra cars which have been doing well in sales – Scorpio, Bolero, XUV300, etc.
Mahindra Sales Dec 2021
Mahindra’s automotive sector which comprises passenger vehicles, utility vehicles and commercial vehicles registered sales of 39,157 units last month. The passenger vehicle segment (vars, UVs, cars) accounted for 17,722 units at a YoY growth of 10%. The automaker manage to ship 3,017 units overseas last month, a 37% YoY improvement.
In terms of growth rate, the company’s commercial vehicles did a bit better at 14% YoY with 15,938 units dispatched in December 2021. The company reports that every major CV sub-segments registered positive growth whereas the three-wheeler arm fared poor with a negative growth of 13% during the same period.
Vijay Nakra, CEO of Mahindra’s Automotive Division, stated that the company has been witnessing an sustained growth in demand across its product portfolio but also acknowledged that that semi-conductor shortage still a significant challenge to surmount.
In a year which witnessed continuation of the global pandemic despite massive vaccination onslaughts and emergence of the so-called new normal, Mahindra managed to grow its automotive division by around 45%. However, this significant growth comes from a very weak base in 2020 when production came to a grounding halt for a few months.
Mahindra’s prospects in 2022
With global OEMs scrambling to secure its semi-conductor parts supply chain amidst market recovery from the pandemic, the production constraints are tipped to be less severe in the coming months. We expect Mahindra to gradually increase its production rate throughout 2022 with an aim of clearing its backlogs at the earliest.
The newly launched flagship XUV700 currently has a waiting period of over a year, and this is something the automaker will be focusing on reducing. The new generation Thar too has a massive order backlog which needs to be addressed. While long waiting period is frustrating for customers some of whom may be tempted to shop elsewhere, the situation is not too different at the rival’s camps either. Overall, more than 6.5 lakh new car customers are waiting patiently for delivery in India as of now.
Given that both its major new launches in 2021 are affected by the supply chain bottleneck, Mahindra & Mahindra seems to be taking its time with the launch of its eagerly anticipated next generation Scorpio. The ladder frame SUV is expected to emerge as another high-volume hit which, in current circumstances, would only become another demand-supply headache for the OEM to manage and impatient customers to appease.