Recapturing the Uv Market Segment
Recapturing the UV Market SegmentMr Pravin Shah, President and chief executive, Mahindra and Mahindra was looking at declining market share of Mahindra in the UV segment. He had a meeting scheduled with Anand Mahindra, chairman and md , Mahindra Group after a month. So, he had to come up with a marketing plan and the reason for declining share of Mahindra in the UV segment.  Mahindra introduced its first utility vehicle in India in 1947. Almost seventy years after the start, it remains Indias one of the no.1 UV manufacturer with an arrangement of classification characterizing UVs that are extreme, solid, refined and worked to excite. Today, they offer an entire portfolio – electric vehicles to UVs; pick-ups to substantial business vehicles – and their vehicles ply the streets in more than 70 nations comprehensively. They are making world-class R&D offices in India and the US. The pioneer in the utility vehicles (UV) section for quite a long while, Mahindra and Mahindra (M&M), appears to at last be losing ground to other automobile creators, for example, Maruti Suzuki, Hyundai and Toyota, whose new dispatches and push on item improvement in the classification have just consumed a considerable lump of M&Ms piece of the overall industry.Company BackgroundMahindra & Mahindra was established in 1945 and converted into a public limited company in 1948. Initially, the company imported and assembled Willys Jeep. Manufacturing activities of the automotive division started in 1954 through collaboration with Willys Overland Corporation (currently part of the Daimler Chrysler group). Till 1994,  all businesses of Mahindra were under one company – M&M. The company was then re-structured and thus, the core manufacturing utility vehicles light commercial vehicles and tractors remained with the flagship company.
Due to changes in consumer tastes, buying habits and changes in the automotive industry in India, the company re-aligned their brand portfolios to introduce new market offers from 1997.Utility Vehicle MarketIn 2010, UV constituted just about 12.59 percent of overall passenger vehicle sales. Today, they account for over 25% in 2017 (Exhibit 6). But the story has not been the same for Mahindra  as they are losing their market share in the UV segment.  Considering a strong 42 per cent share in the domestic utility vehicle (UV) segment a few years ago, M&M’s share has gone below to 30 per cent. The growth of UV segment can be attributed to the rise of small SUVs. Two main entrants in the small UV segment Maruti Suzuki Vitara Brezza and Hyundai Creta have been the driving force behind the growth of UV market (Exhibit 2).Holding the market share usually gets difficult for the market leader when a segment sees rapid growth. Mahindra & Mahindra a major leader in utility segment is finding itself in a similar scenario, as the major player Mahindra & Mahindra, the utility vehicle segment has been unable to hold on to its market share despite posting a double-digit growth in its volume.The two competitors have had a successful product each in this segment: Creta from Hyundai in July 2015 and the Brezza from Maruti in March this year. Maruti has almost doubled its share in the UV segment from 16 percent in 2015-16 of FY16 to 25 percent in 2016-17. Hyundai, also, has expanded share from 11 percent to 13 % 2015-16 to 2016-17 (Exhibit 5).