Mahindra South Africa gears up for local assembly

27th October 2017

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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Mahindra South Africa (SA) should start the local semiknockdown assembly of its new- generation Mahindra Pik Up and Bolero bakkie within the next six months, says Mahindra Automotive & Farm Equipment International Operations chief Arvind Mathew.

“Local assembly is my number one priority,” he says. “South Africa is a huge priority for Mahindra. We believe we have to invest in the country. The aim is to have the first vehicle roll off the line in the next six months.”

Mahindra SA is still a relatively small player in the local auto market, but has been growing sales steadily since its arrival 13 years ago.

New-vehicle sales reached 3 250 units in the 2015 financial year, ending March 31, with 5 000 units possible for the current financial year, says Mahindra SA CEO Sanjoy Gupta.

“If we achieve this, it would mean we have had 53% growth since 2015.”

Mathew says the financial business case for local assembly does “not make sense”, but that the investment is necessary as Mahindra views South Africa as the Indian conglomerate’s stepping stone into the wider African market.

“The general approval for assembly is there, but a few decisions still need to be taken.”

These decisions include production location (Durban or Port Elizabeth), as well as whether Mahindra SA would make use of a contract assembler, or keep assembly in-house.

“We are way beyond whether we should do it or not,” says Mathew.

Mahindra SA sold 375 vehicles in South Africa in September, including 73 Boleros and 89 Pik Ups.

With production volumes under 10 000 units a year, Mahindra SA will not qualify for any assistance from government’s Automotive Production and Development Programme.

TractorsMahindra SA has homologated two tractors (80 hp and 90 hp) for sale in the African market, adds Mathew.

Despite the average size of South African farms demanding tractors of around 120 hp, he believes there is space for Mahindra’s farm equipment on the local market.

Mahindra tractors will probably go on sale in South Africa in 2018.

Tractor sales will not happen through the Mahindra vehicle dealerships.

“We will separate tractor and vehicle sales,” emphasises Mathew.

He adds that Mahindra is also mulling selling backhoe loaders in South Africa.

Mahindra is the world’s biggest tractor manufacturer by volume.

Mahindra Pik Up
The new-generation Mahindra Pik Up is a more powerful vehicle (103 kW) than its predecessor. It also features a new six-speed transmission.

Specifications have been significantly upgraded to include a touch screen infotainment and navigation system, a multifunction steering wheel, increased ride comfort, cruise control, a new dark interior and a towing capacity of 2.5 t.

Mahindra SA hopes the new Pik Up will boost the company’s sales in the local market, says Gupta. He says the enhancements made to what was previously known as the Scorpio Pik Up should broaden the vehicle’s appeal, attracting “larger volumes of people” to the Mahindra brand.

Pricing for the basic single-cab workhorse Pik Up starts at R187 995, with the service plan optional; the top-of-the-range 4 × 4 double-cab is priced at R354 995.

Pricing includes a four-year /120 000 km warranty and roadside assistance, as well as a five-year/90 000 km service plan. Services are at 20 000 km intervals, or every 12 months, whichever comes first.


Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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