M&M’s subsidiary, Mahindra Reva Electric Vehicles launched electric car ‘e2o’ in March that was priced at Rs 5.96 lakh in Delhi at the back state government’s subsidy.
This was the first offering from M&M after it acquired Bangalore-based Reva over three years back. Then, it had said that it planned to extend the technology to two wheeler and other passenger vehicles. The central government had earlier promised subsidy plans to boost sales of electric vehicles to 6 to 7 million a year.
“We are planning to bring the electric version of Mxximo, Gio and Verito but without government support, we would not go beyond e2o,” said Pawan Goenka, executive director and president at M&M in a press briefing.
The company has been able to sell a mere 400 e2os so far and that includes the sales in Nepal and Sri Lanka. Mahindra Reva made a loss of Rs 31.8 crore last year. Now, the company is targeting exports to European countries such as the UK, Norway and Denmark to turn its electric car business profitable.
Goenka was briefing media after announcing a 4.6 per cent rise in the company’s consolidated net profit for the quarter ending September to Rs 835.7 crore. Net profit for the company grew as the company was able to boost its sale for tractors that more than compensated the decline in utility vehicle sales. It is now reworking on its Xylo and Quanto brands of utility vehicles that have failed to pick up in the market.
Also, the company is facing a tough challenge in its commercial vehicle front. “It is the largest slowdown that I have seen and do not expect demands to improve for the next 4 to 6 quarters,” said Goenka. About a year back, M&M bought out 49 per cent stake from its US-based joint venture partner Navistar in Mahindra Navistar Automotives and Mahindra Navistar Engines for Rs 175 crore.
According to the data from industry body SIAM, the sale of medium and heavy goods carriers has declined by 29 per cent in the April to October period to 95,000 vehicles.
However, the company has been able to successfully turn around beleaguered South Korean utility vehicle maker SsangYong, which it acquired in 2010. It is selling over 10,000 units a month now. “The good volume growth for SsangYong product shows that the brand is getting back traction, so we expect better performance from it now,” said Goenka.