Mahindra plans Scorpio launch in China

13 November 2008

Mumbai: Mahindra & Mahindra is weighing plans to launch its sports utility vehicles Scorpio, Bolero, Xylo and pickup trucks in the Chinese market where its tractors already have a presence through Mahindra China Tractors, a joint venture company between M&M and Jiangling Motors Company.

M&M also has a 51 per cent stake in Jiangsu Yueda Yancheng Tractor Manufacturing Company, China's third largest tractor company. Although the Chinese automotive market is more than three times the size of the Indian market at close to 9 million units annually, it is a restricted market due to stringent government regulations.

Multinational automotive companies like Ford, Volkswagen, General Motors operate in China through joint ventures with local auto companies.

The auto market in China has been slowing down according to recent reports. The growth in the auto sector has slowed down to 18 per cent in the first half of this year with sales at 5.18 million units. The growth during the previous year stood above 20 per cent.

M&M has been expanding its international reach with launches in newer markets such as Africa, Europe, Latin America and North America.

M&M is currently readying to launch its SUVs in the US market and the Scorpio brand will be promoted with a $60 million advertising budget over the first year.

M &M is focusing on the mileage card to push its vehicles in the US. The major selling points of its pickup vehicles is that each will give an estimated gas mileage of 33 mpg on the highway and will be competitively priced. In the U.S., M&M trucks will be distributed by Global Vehicles USA, which currently has 325 dealerships primarily on the East and West Coasts, as well as in the South.