The Hindu : Utility vehicle segment to perk up next fiscal

Online edition of India's National Newspaper
Wednesday, Nov 27, 2002

Business

Business

Utility vehicle segment to perk up next fiscal

By Our Staff Reporter

BANGALORE NOV. 26. The utility vehicle (UV) industry is set to perk up with volume sales expected across the board (both multi-purpose and sports UVs) in the coming fiscal. Having gone through a flattened phase for the last two years, where the UV market stabilised at a 5.6 per cent growth rate, industry estimates conservatively project at least a 10-15 per cent growth over the next year.

The reasons for the optimistic outlook include the launch of multiple UV brands by companies such as Mahindra and Tata. Moreover the introduction of imported vehicles like the Mitsubishi Pajero, albiet in the high-end premium UV segment, has "created an aspirational value with consumers intent on buying a multi-purpose vehicle.

We are not talking of customers who own passenger cars buying these utility vehicles, but those who want more value for money," Gautam Nagwekar, Vice President, Sales, Automotive Sector, Mahindra & Mahindra said.

The only drawback to a spurt in sales has been the high price points ranging from Rs. 5 lakhs to Rs. 8 lakhs depending on the UV model. In keeping with the aspirational value and driving sales through a lower pricing structure, Mahindra & Mahindra has sought to break the Rs. 5 lakh barrier with the launch of its Bolero Sportz.

Already having a 47 per cent market share, M & M is looking at increasing its share, particularly for its Bolero brand through the new variant. "Bolero Sportz will help the company bolster growth and we expect to touch 18-25 per cent increase within the next 9-12 months," Mr. Nagwekar said declining to go into specific targets.

Incidentally, the price differential between the Bolero GLX and Bolero Sportz is Rs. 45,000 with the Bolero Sportz price hovering between Rs. 4.86 lakhs and Rs. 4.93 lakhs depending on the State.

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