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Mahindra may increase vehicle prices in Q1 next fiscal

Last month, the automaker announced a price increase of personal and commercial vehicles by around 1.9 per cent with immediate effect

twitter-logoBusinessToday.In | February 6, 2021 | Updated 13:30 IST
Mahindra may increase vehicle prices in Q1 next fiscal
Mahindra & Mahindra (M&M) has hinted at a likely price increase of its range of vehicles over the next few months

Mahindra & Mahindra (M&M), India's fourth-largest passenger carmaker, has hinted at a likely price increase of its range of vehicles over the next few months in the wake of rising commodity prices.

The manufacturer, which was recently reported to have slashed jobs in its North American operations, may cut them further even as it gets ready to launch its off-roader vehicle Roxor.

Speaking to the media in a virtual post-earning press conference, Rajesh Jejurikar, Executive Director Automotive & Farm Sectors, Mahindra & Mahindra, said, "We have just taken some price increase in January and unless things come under control we would probably be taking one again in Q1 of the next financial year."

He was answering a question on the impact of increasing commodity prices and how the company was contriving to offset it.

Also Read: Why Ambanis, Tatas, Mahindras need to work together for India's new Hydrogen Mission

Jejurikar further said, "We do try to mitigate this kind of commodity increase with other internal cost measures, both on material cost and value engineering, and managing fixed cost. So typically, when we have this kind of situation, we use multiple levers to manage".

Last month, the automaker announced a price increase of personal and commercial vehicles by around 1.9 per cent with immediate effect.

Commenting on the job cuts in the company's North American operations, he said the manpower rationalisation was not around the tractor business but was mainly around the product development centre in Detroit as M&M decided not to go ahead to bid for a contract of United States Postal Services.

"That team was not going to be doing the development work that was at the concept stage. So, it is really around that and has nothing to do with the tractor business," he added.

Also Read: M&M Q3 results: Net profit zooms 250% to Rs 704 crore, revenue up 11%

When asked if there are possibilities for further job cuts in the North American unit ahead of the planned launch of the off-roader Roxor, Jejurikar said, "We just got approval for the new Roxor model. We are working on a relaunch approach, Details not finalised but we may go for much more digital and there may hence be some manpower restructuring beyond what has already happened because there was no production rally happening in the last few months".

Stating that the relaunch of the new Roxor will take a few more months without sharing a definite timeline, Jejurikar said, "We will then be working on what exactly is the right resourcing for the launch. Manpower number is not finalised".

M&M Deputy Managing Director and Group CFO Anish Shah said the company has also rationalised manpower at the engineering services of the Italian unit Pininfarina as it had "excess count compared to what the market demand was."

(With inputs from PTI.)

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