Going at it again

Three and half years after Mahindra & Mahindra (M&M) launched the Quanto, its first compact SUV (sports utility vehicle) in September 2012, the brand has now been given a facelift. After it failed to take off, it is now called the NuvoSport and is M&M’s attempt to gain a serious foothold into the SUV segment, one that accounts for close to 25% of the overall passenger vehicle market.

Apart from growth, there is a rationale for players to be in compact SUVs, often referred to as the sub-four metre segment. Besides, it attracts an excise duty of 12% compared to 30% for bigger cars. The Premier Rio was the first compact SUV in India, which did not meet with any great success. M&M spotted the opportunity after both its SUV brands, Bolero and Scorpio had done well. When the Quanto was launched in2012 at an attractive entry point price of Rs.5.82 lakh, things were well positioned for it.

It was a market devoid of any serious competition, though the big problem was that most people viewed it as a stripped down version of the Xylo, a MUV (multi utility vehicle) that the company had launched in early 2009. Less than a year after its launch, the Quanto was up against the Ford EcoSport, priced at Rs.5.59 lakh and considered a superior product technologically. The latter was a success and even, over the last one year, it has, on an average, sold 3,000 vehicles each month. Even other entrants like the Duster have made an impact, while the Quanto from 2,000 vehicles per month at launch was down to less than 100 by mid last year.

Given the potential of the compact SUV story, it was critical for M&M to get it right here. Last September, it launched two compact brands, the TUV 300 followed by the KUV100 early this year. If the former is more likely to get in buyers from rural India, the KUV100 is really a budget option at an entry price of Rs.4.5 lakh. Both these brands have met with some initial success. Now, the NuvoSport, is looking a lifestyle positioning and is priced at Rs.7.35 lakh.

The big worry, though, has been the entry of the Maruti Vitara Brezza, launched in March at a Rs.6.99 lakh entry point price tag, that has already outsold the Ford EcoSport. This is the first compact SUV from Maruti, the country’s largest passenger car company. By the looks of it, it seems like a serious challenge for the NuvoSport. Hormazd Sorabjee, Editor, Autocar India, points to both the EcoSport and the Brezza as being more accomplished products in that price range. “In that sense, it will not be easy for the NuvoSport to get it right. It may work in rural India where people probably look at it as a SUV that has attitude,” he says. For a company that is synonymous with the success of the SUV story in India, M&M will get to it right with the smaller version. That is going to be a serious challenge, for competition is not about to take its foot off the pedal.