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Why Mahindra dealers are unhappy with the company?

Mahindra has been known for its different league of UVs that changed India’s automobile landscape. Its highly localised products brought the rich ownership experience much beyond the rudimentary Maruti & Tata cars .

 

However, over the years the newly launched Mahindra cars and SUV’s are considered much diluted products than their predecessors, that took off the sheen from this coveted Indian brand.

 

Even after a superlative start with its deep rural penetration and acceptance in hinterland, due to its tractor dealer network, Mahindra’s failure to  imitate the success of Maruti Suzuki or Hyundai Motor India, is hard to digest. 

 

Though, still the fourth largest carmaker in India, just a small success came its way with the diesel fired Thar, its only notable success in the recent past.

 

This success has also created many problems for Mahindra, company never expected this kind of demand, and hasn’t planned the production for such volume. There is long waiting for Thar, again creating bigger dissatisfaction and disturbance for dealers as well as customers.

 

Industry experts say that company failed to read Indian mind and develop products & strategy accordingly.

 

But exactly what ails at Mahindra? Market share is shrinking, dealers are unhappy, customers aren’t too happy either. Has Mahindra lost the grip, or do they need to go back to the drawing board.

 

While some of the products like Marazzo and the Alturas couldn’t do well, due to product quality and design, it's the Bolero, Scorpio and XUV500 that have helped Mahindra to sail the boat over the years.
 

New players in UV like Kia and MG, with their stylish product design and aggressive marketing have made a strong start, and bigger dent. Experts think that in a shrunken market, new entrants are garnering volume and market share at the cost of mature players like Mahindra.

Experts feel that situation might be tougher post the Covid 2nd wave. Numbers will go down further due to unpredictable environment & unstable economic situation. Also other factors like chip supply etc will add fuel to the fire.

 

Last financial year Mahindra has been declined to the fourth position in a very close competition with Kia Motors. Whereas Tata motors has captured the third spot, and posted highest volume in the last 8 years
 

Market share % of top 5 players

Company FY2021 FY2020
Maruti 48% 50%
Hyundai 17.3% 17.6%
Tata 8.2% 5%
Mahindra 5.8% 6.7%
Kia 5.7% 3%


Mahindra has de-grown from 6.7% to 5.8%, which is the company’s lowest ever market share in passenger vehicles.
 

Car Dealer Tracker recently conducted a survey with  dealers on the following points.

 

Claims settlement policy of OEM

Marketing support from OEM

Communication flow & transparency from OEM

Quality of trainings provided by OEM

Commercial policy (Dealer Margin) of OEM

Retail & WS incentive policy

Effectiveness of discount control by OEM

Territory infringement policy of OEM

Product range and quality of OEM

Overall HO & Regional office support

 

Feedback received from Mahindra dealer principals, clearly shows that there is huge dissatisfaction among dealer principals, almost on all the points. Especially on company’s discount control policy and territory infringement policy, dealers feel company doesn’t have any policy at all.

Mahindra might have to relook at the strategies and go back to the drawing board, as new companies are eating significantly into its UV market share, it might take away some good dealers also.