Tata Motors, M&M slash prices to boost demand amid unsold inventory

Move came a day after UP government waived registration fees on strong hybrid cars

(This report has been updated)

Automobile majors Tata Motors and Mahindra & Mahindra (M&M) have slashed the prices of their popular vehicles in a bid to stimulate demand, at a time when car sales are experiencing a challenging phase with around Rs 60,000 crore worth of inventory lying unsold with dealers. Ongoing monsoon season may also affect the footfall.

M&M has slashed prices by up to Rs 2.05 lakh, while Tata Motors reduced it by up to Rs 70,000 on select models along with benefits of up to Rs 1.4 lakh on popular SUV variants. 

Interestingly, it comes a day after the Uttar Pradesh government waived registration fees on strong hybrid cars, effectively reducing their on-road prices by up to Rs 4 lakh.

M&M has announced special ex-showroom pricing for all the AX7 variants of their XUV700 SUV effective for four months starting July 10, 2024. The AX7 range now starts at Rs 19.49 lakh, down from the earlier price of Rs 21.54 lakh. This announcement comes with the celebration of the XUV700’s third anniversary and the milestone of selling around 200,000 units in less than three years. 

To enhance its appeal further, M&M has introduced two new colour options. Additionally, new variants like the AX5 Select, MX 7-seater, and Blaze edition have been launched, ensuring a broader range of choices for customers. AX7 range features amenities such as a Panoramic Sunroof, dual 26.03 cm HD Super-screen, Level-2 ADAS with Adaptive Cruise Control, and a 3D Audio system with 12 Sony speakers.

Similarly, Tata Motors in order to boost sales has reduced the prices of its flagship SUVs, Harrier and Safari, with starting prices now at Rs 14.99 lakh and Rs 15.49 lakh, respectively. Alongside these price cuts, Tata Motors is offering benefits of up to Rs 1.4 lakh on popular SUV variants.

For electric vehicles such as Nexon.ev the benefits go up to Rs 1.3 lakhs and for Punch.ev consumers can avail benefits up to Rs 30,000. These offers are valid till 31st July. This announcement came as the carmaker celebrated the milestone of selling over 2 million SUVs in India.  

Speaking on this, Vivek Srivatsa, Chief Commercial Officer, Tata Passenger Electric Mobility said, “Our ability to understand the SUV segment and provide the right product for every customer needs helps us maintain consistency and dominant leadership in the segment.”

Speaking on the price cuts, Manish Raj Singhania, President of the Federation of Automobile Dealers Association (FADA), stated, "We are now transitioning from a supply-driven market to a demand-driven market. Initially, shortages allowed OEMs to command higher prices, but now with adequate supply, corrections are necessary to attract customers back to showrooms. Tata and Mahindra's decision to slash prices on popular SUV models reflects their responsiveness to market dynamics and customer feedback. I anticipate other manufacturers will follow suit to align pricing with market demand and consumer expectations. Discounts will play a crucial role in stimulating sales and clearing dealer inventory efficiently, ensuring a win-win for consumers and dealers alike."

With substantial unsold inventory along with other challenges, both Tata Motors and M&M’s pricing strategies aim to revive consumer interest and stimulate sales.

Retail car sales in India registered a year-on-year (Y-o-Y) drop of 6.7 per cent in June, 2024, the biggest dip in two and half years.

Steal the deal?

Slashed prices by major players

Tata Harrier

Earlier:  Rs 15.49 lakh

Now: Rs 14.99 lakh

Reduced by Rs 50,000

Tata Safari

Earlier:  Rs 16.19 lakh

Now: Rs 15.49 lakh

Reduced by Rs 70,000

Mahindra (AX7 range)

Earlier:  Rs 21.54 lakh

Now: Rs 19.49 lakh

Reduced by Rs 2.05 lakh