Case study of Mahindra and Mahindra

indian market

Vibhavari Madki

Oct 8, 2020 — 5 min read

India is one of the largest growing markets for the automobile industry in the world and Mahindra and Mahindra is one of a kind automobile company that has evolved and changed the markets too. Mahindra advertises and puts out content that is entertaining to the targeted people anywhere in the globe and by doing so, Mahindra has attracted a global audience for many years.

Mahindra and Mahindra has taken several steps in order to promote their products which are vehicles across the globe. The company decided to use the visual media, social media, physical media and the print media so that the people become aware of its potential products.

About Mahindra and Mahindra

Mahindra and Mahindra (M&M) is one of the largest private companies in India dominating the automobile industry for decades. M&M is known as a farm equipment unit and is also the 3rd largest producer of tractors in the world and it has two major operating divisions produces more than 100,000 tractors a year.

Mahindra and Mahindra sold around more than 85,000 in the year 2005, achieving a growth rate of 30 % in the previous year. Almost 6 million farmers in India depend upon this magnificent organization.

The company’s tractor exports to the regions like the US, Africa, and several other countries in South East Asia face close competition. The company set up its manufacturing facilities at multiple locations increases the complexity of the supply operations. Therefore, the company needed an integrated solution that is able to link all the plants to optimize costs and operational eﬃciency and respond swiftly to customer requirements.

History of Mahindra and Mahindra

The history of this giant company illustrates the role of leadership in transforming an ageing family business into a formidable modern business player which is indeed suitable for courses on managing the family business and all sorts of strategy.

Mahindra and Mahindra, a core conglomerate Mahindra Group, was founded by Mahindra brothers Harikrishnan, Jayakrishnan and Jagdish Chandra Mahindra along with Malik Ghulam Muhammad in 1945 as Mahindra and Mohamed, a steel trading company. Anand Mahindra whos is present Chairman of Mahindra Group, is the grandson of Jagdish Chandra Mahindra.

Mahindra & Mohamed changed its name to the current Mahindra & Mahindra in the year 1947 after India-Pakistan partition and entered the automotive manufacturing business when they started the licensed production of Jeep.

Currently, M&M operates six plants in India. Its Nasik plant, which started its operations in 1980 produces five different types of vehicles, which includes main models of Scorpio and Xylo, with an annual production of 200,000 vehicles.

M&M started its E-Business initiatives in 1995 itself. This Business started with the launch of a dedicated network across 8 manufacturing locations, 33 area offices and 4 branch offices. In the year 1996, the company launched its website mahindraworld.com in the month of June, which was one of the first corporate websites.

Anand G. Mahindra is the managing director of Mahindra and Mahindra group and is given credits for turning around his inherited family business into a highly professionalized multinational firm operating in diverse business segments.

He transformed M&M from a farm equipment manufacturer into a Utility Vehicle manufacturer. By the year 2008, M&M was the leader in the Utility Vehicle segment of India. The strategies resulted in the creation of Scorpio which is M&M’s Sports Utility Vehicle (SUV). It has been the company’s claim to fame in the national and international arena. Mahindra is now venturing into all sorts of segments in the automotive industry.

Mahindra and Mahindra's Tractor Market

Mahindra and Mahindra is the major player in the tractor world in India. After an amazing growth for a few years, the tractor market in India had stagnated during the years 1998-2001.

Mahindra has been selling its tractor automobiles and utility vehicles in foreign markets including the USA. Some of the components and raw products have been imported from abroad. M&M has a 100 % subsidiary in the USA, with a strong network of 100 dealers.

Part of the expansion strategy to build a global supply chain, Mahindra USA also signed an MoU with the Korean tractor organization called Tong Yang, according to them, Mahindra will source high horsepower and sell them around the world under the Mahindra brand name.

Mahindra and Mahindra's Growth

Mahindra and Mahindra is India’s leading SUV manufacturer auto sales numbers which stood at around 37,925 units during the year 2015 and 36,328 units during December 2014, showing a growth of 4%.

A huge amount of Mahindra’s growth has come from business acquisitions. In the span of last few years, the company had bought majority stakes in Korean automaker Ssangyong, IT Company Satyam Computer Services, electric car maker Reva, two-wheeler maker Kinetic, Punjab Tractors and Australia’s Gippsland Aeronautics.

M&M has also built globally competitive products in the automotive industry. The company exports its tractors to various countries and it is also planning to export the company's flagship product, Scorpio to the US and Europe.

Company's Future Plans

Mahindra and Mahindra company's future plans include entering into a variety of segments in the automotive segment using its Research and Development capabilities.

However, the new and emerging market companies like Mahindra suffer from various challenges like institutional voids, constant changes in consumer behaviour and lack of brand recognition, that test their ability to compete with global giants. However, the low-cost model alone cannot always formulate a winning strategy.

The Bottom Line

Mahindra and Mahindra also makes a partnership with multinational companies securing the future of itself. The company has touched many platforms and established itself a secure place in the Indian as well as global market.