Mahindra’s Truck and Bus Division (MTBD), a part of the Mahindra Group, has shared groundbreaking initiatives and future plans for their commercial vehicle segment. In a comprehensive discussion with N. Balasubramanian and Abhilash. U, Jalaj Gupta, Business Head – Commercial Vehicles, Mahindra & Mahindra, delves into the company’s innovative mileage guarantee, service commitments, manufacturing capacities, market outlook, and strategic growth plans, highlighting their unwavering commitment to fuel efficiency, customer satisfaction, and industry leadership.
Mahindra Truck and Bus (MTB), a part of the Mahindra Group, a key player in the commercial vehicle sector, offers a broad range of products that cater to various needs in the haulage, tipper, and bus segments. Their portfolio includes multi-axle vehicles, tractor trailers, and different tonnage points across their HCV, ILCV, and LCV ranges.
MTB, a strong challenger brand in the commercial vehicle market, continues to disrupt the industry by announcing a unique customer value proposition for their entire BS6 OBD II range of BLAZO X, FURIO, OPTIMO & JAYO range of HCV, ICV & LCV trucks. This industry first initiative of ‘Get More Mileage or Give the Truck Back’ is introduced to address the challenges posed by rising fuel prices and evolving regulatory standards.
Jalaj Gupta, Business Head – Commercial Vehicles, Mahindra & Mahindra, emphasizes, “Our vehicles’ superior technological prowess has resulted in higher fluid efficiency. It was in 2016, when we launched Mileage guarantee in BS3 range. Thereafter we continued this in BS4 & BS6 OBD1 and now launching in BS6 OBD2, which will help increasing the profitability of transporters.
We have seen an increasing impact on transport clients’ margins as fuel costs rise without corresponding increases in freight rates. We saw the need to improve engine efficiency further in order to meet new standards and exceed customer expectations. The new mileage guarantee, embodied by the motto “Zyada Mileage Nahin toh Truck wapas” will provide unmatched value to our customers.”
MTB’s new range includes the proven 7.2L mPower Engine (HCVs) and mDi Tech Engine (ILCV) with FuelSmart Technology, Mild EGR with a proven After Treatment System that results in lower Ad Blue Consumption, and many other technological advancements, as well as the cutting-edge iMAXX Telematics solution, all of which ensure guaranteed higher mileage. This Mileage guarantee not only includes Fuel efficiency but it’s also a combination of lowest Ad Blue consumption, So truly speaking Mahindra’s mileage guarantee means best-in-class ‘Fluid Efficiency’.
‘Mileage Guarantee’ Promise
The mileage guarantee initiative marks a major advancement for MTB, reinforcing their dedication to fuel efficiency and customer satisfaction. Launched in 2016 with the BS3 Blazo and its innovative FuelSmart technology, Gupta recalls, “The Blazo’s launch was a milestone, marking the start of our journey towards exceptional mileage guarantees.” This commitment continued with the introduction of the Furio in BS4 and the BS6 range with OBD I, setting new benchmarks for fuel efficiency and reliability.
With the transition to BS6 and OBD II technology, MTB has maintained its focus on innovation. Their mileage guarantee ensures high fuel efficiency or the option to return the truck. Gupta notes, “In eight years, no truck has been returned under our mileage guarantee. Our promise is simple: achieve high mileage or return the vehicle.” This initiative, now extended to the OBD II range, highlights Mahindra’s confidence in their vehicles and commitment to customer satisfaction.
The mileage guarantee applies to HCVs, ILCV trucks, and buses, but not tippers. “We ensure our guarantee covers all relevant ranges, reassuring customers in the cargo and bus segments,” says Gupta. Vehicles purchased from July 8, 2024, are eligible for this six-month guarantee. If mileage issues arise, customers can raise disputes, and Mahindra will conduct trials to resolve them, even offering to take back the truck if needed.
To ensure the efficacy of these enhancements, MTB conducted intense fluid efficiency (diesel + Ad Blue) testing across 21 product categories, including 71 models including competitors’ vehicles. During these testing, which lasted over 1 lakh kilometres and included a variety of load and road conditions, the company reaffirmed its commitment to providing exceptional mileage performance. All these testing was conducted under the supervision of and validated by an independent credible agency Ernst & Young. The result reinforced MTB’s reputation for dependability and efficiency in the commercial vehicle industry. Gupta highlights, “Our comprehensive trials, supervised by independent experts, ensure the highest standards.” Field teams also conducted additional trials to validate their findings and reinforce the mileage guarantee.
Double Service Guarantee
In addition to the mileage guarantee, MTB promises to complete vehicle repairs within 36 hours or pay ₹3,000 day if they fail. For breakdowns, they guarantee to get the truck back on the road within 48 hours or offer ₹1,000 per day until operational. Gupta highlights, “Our service guarantee ensures quick and efficient issue resolution.” This covers running repairs only and is supported by MTB’s expanding network and iMAXX technology for predicting and addressing failures.
Beyond product and service guarantees, Mahindra has initiated several programs that contribute to the broader community. These include SAARTHI ABHIYAAN, which provides scholarships to the daughters of drivers, and M AASHRAY, an insurance program for drivers of Mahindra trucks. “Our initiatives reflect our commitment to the welfare of the broader community and our customers,” adds Gupta.
OBD II Mileage Guarantee and Innovations
“This step is part of our broader strategy to ensure reliability and cost-effectiveness in our offerings. It’s about staying true to our commitment to provide value through low total cost of ownership,” states Gupta. The shift to mileage guarantees aligns with Mahindra’s brand purpose of helping customers succeed and advance professionally. “Our goal is to provide products with the lowest total cost of ownership. Mileage guarantees are key to this promise,” says Gupta.
Implementing these guarantees presents challenges, particularly with field operations and customer claims. “The process is demanding and stressful, especially with disputes over fuel efficiency,” notes Gupta. To address this, Mahindra has created a Value Establishment team dedicated to resolving disputes and proving the value of their fuel efficiency. “Our team, with a champion in every state, is crucial in this process,” Gupta adds.
MTBD Manufacturing Capacities and CV Market Outlook
Mahindra’s truck manufacturing capacity is substantial, with the Chakan plant at 38,000 trucks and the Zaheerabad plant at 12,000–13,000 trucks, totaling around 50,000 trucks. Last year, they sold about 13,000 units across both plants. Gupta notes, “We are well-equipped from a capacity standpoint; the challenge is to increase business volume to utilize this capacity fully.” The focus is on driving higher sales and business growth, with no current capacity challenges for trucks and buses, though some model variations may differ.
As the commercial vehicle industry recovers from recent setbacks, Mahindra is optimistic about reaching new heights in total industry volume (TIV). “Following the BS VI migration and the COVID-19 pandemic, we are now witnessing a V-shaped recovery. Last year, the TIV did not surpass the F19 peak. However, with a stable government at the centre, we are hopeful that, if not this year, then next year, the TIV will exceed the F19 peak. By 2027, we anticipate the industry will reach a new peak,” says Gupta.
Last fiscal year, MTB’s market share was 3.4%, rising to 3.94% by Q1 of this fiscal year. Gupta pointed out that their peak market share was 4.7% in FY20, and their goal is to surpass this and reach over 5% this year. To achieve this, Mahindra plans to improve performance in sub-segments and optimize dealer networks. Although addressability has declined from 97% in FY19 to 79%, Mahindra’s truck and bus business is growing at 46%, exceeding the industry’s 30% CAGR. The strategy aims to enhance addressability and capitalize on industry growth, with a long-term goal of exceeding 20% market share.
Upgrading Tipper Range and Network
Mahindra’s new product developments, like the M-Dura Tipper in the 28-tonne and 35-tonne segments, aim to fill gaps and strengthen their market position. They are also entering the 48-tonne tipper segment, with vehicle seeding this year and a launch next year. Tippers and transit mixers remain key focuses, alongside expanding their range of construction equipment, including graders and backhoe loaders.
Despite the challenges posed by COVID-19 and the migration to OBD II standards, Mahindra has successfully maintained a stable dealer network. “We have retained most of our dealers despite the disruptions caused by COVID-19. Our focus is now on working closely with these dealers to scale up operations and expand our market reach,” highlights Gupta.
MTB’s dealer network strategy focuses on quality. Gupta explained, “We are selective with our dealerships, concentrating on those that drive sales.” Of about 80 dealers, 50 are identified as “focus dealers,” responsible for 51% of market share and 85% of sales. This approach helps scale successful models and expand workshops and service centers, including dealer-operated, independent Mahindra Customer Care Centers (MCCCs), and multi-brand service centers for broader support.
Aftersales Revenue Streams and Driver Training
Mahindra is exploring revenue models beyond vehicle sales, including the recon business and annual maintenance contracts (AMCs). Gupta notes that while spare parts and AMCs contribute less to overall sales, they offer additional revenue opportunities. The company is expanding its recon business to include more components. Currently, iMAXX telematics is used mainly for operational improvements and integration with upcoming ADAS features, not for direct monetization.
When customers purchase a Mahindra truck or bus, they receive a free three-year iMAXX telematics subscription. After this period, renewal costs cover basic iMAXX expenses. Mahindra aims to use iMAXX as a competitive advantage rather than a revenue source. Challenges in the commercial vehicle sector often arise at the single-operator level rather than the fleet operator level. This is why renewal rates for iMAXX subscriptions are notably lower among ILCV customers, who typically operate one or two vehicles, compared to larger transporters who are more familiar with the benefits of iMAXX. Currently, about 60% of iMAXX renewals occur, but Mahindra aims to improve this.
For training, MTB operates a centralized Training Centre at its headquarters, along with three regional centers in the North, South, and East. These facilities train drivers, dealer workshop staff, and mechanics. While MTB is not focused on establishing its own driving training centers, it is open to collaborating with state governments for such initiatives.
MTBD Exports
MTB faces export challenges due to the transition from BS3 to BS6 parts, particularly in markets like Africa where BS3 remains common. Despite longer lead times, MTB continues to export to Africa and other regions. The company plans to expand its global footprint and is also using distributors, such as in South Africa, to enhance truck and bus sales.
Looking ahead, MTB remains committed to maintaining diesel as the primary fuel source for commercial vehicles, while gradually exploring alternative fuels. “For the foreseeable future, diesel will remain central to our commercial vehicles. However, we are preparing to adapt as alternative fuels gain traction, particularly in specific segments like LCVs”, signs off Gupta.