Mahindra XUV 500

Bruce Lee, Russell Crowe in The Gladiator, Spiderman, a waterIall, combat
helicopters and the cheetah are unlikely to ever be on the same storyboard, not
even in a comic book.
Yet, they were all contenders Ior becoming the inspiration behind the Mahindra
XUV 500.
A committee that comprised Mahindra & Mahindra President (automotive and
Iarm sector) Pawan Goenka, ChieI Executive (automotive division) Rajesh
Jejurikar, chieI executive (technology, product development and sourcing) Rajan
Wadhera, chieI executive (international operations) Pravin Shah and senior vice-
president (marketing) Vivek Nayar was Iormed to select one oI these that best
symbolised power that you can Ieel.
The men, sometime in early 2007, Iinally settled Ior the cheetah.
The decision was conveyed to the style team led by Ramkripa Ananthan.
Ananthan is one oI the Iew women automobile stylists around.
She has studied industrial design at the Indian Institute oI Technology Bombay,
and has worked Ior Mahindra & Mahindra Ior 14 years - she was a part oI the team
that did the interiors oI the Scorpio.
Her job was to style the new sports utility vehicle or SUV around a cheetah - in
the grille, Ienders, lights et cetera.
Her Iirst sketches were ready by mid-2007.
Over the next Iour years, these went through several reiterations; the Iinal result
was the XUV 500 which Goenka calls the Iirst all-Indian global SUV.
"Developing a new product is not Ior the Iainthearted," says he.

How Mahindra deveIoped XUV500. The true story
Last updated on: November 22, 2011 11:23 ST

ruce Lee, Russell Crowe in The Gladiator, Spiderman, a waterfall, combat helicopters and the cheetah are
unlikely to ever be on the same storyboard, not even in a comic book.
Yet, they were all contenders for becoming the inspiration behind the Mahindra XUV 500.
A committee that comprised Mahindra & Mahindra President (automotive and farm sector) Pawan Goenka, Chief
Executive (automotive division) Rajesh Jejurikar, chief executive (technology, product development and sourcing)
Rajan Wadhera, chief executive (international operations) Pravin Shah and senior vice-president (marketing)
Vivek Nayar was formed to select one of these that best symbolised power that you can feel.
Click on XT for more...

The men, sometime in early 2007, finally settled for the cheetah.
The decision was conveyed to the style team led by Ramkripa Ananthan.
Ananthan is one of the few women automobile stylists around.
She has studied industrial design at the ndian nstitute of Technology ombay, and has worked for Mahindra &
Mahindra for 14 years - she was a part of the team that did the interiors of the Scorpio.

Her job was to style the new sports utility vehicle or SUV around a cheetah - in the grille, fenders, lights et
cetera.
Her first sketches were ready by mid-2007.
Over the next four years, these went through several reiterations; the final result was the XUV 500 which Goenka
calls the first all-ndian global SUV.
"Developing a new product is not for the fainthearted," says he.

The idea of a new SUV was born sometime in 2006, when Mahindra & Mahindra decided to go global.
The Scorpio was doing well in ndia but was hardly the product for evolved markets abroad. t did sell overseas,
not as an SUV but as a pickup.
However, nobody knew where to begin.
Ananthan remembers the Paris Auto Show of that year - she went to the stalls of other car makers like suzu and
Kia to meet customers and get a sense of what they wanted in an SUV.

Then, Mahindra & Mahindra did a "needs and wants" survey of 1,500 customers the world over: taly, Spain,
South Africa, Australia and, of course, ndia.
The learning was that customers wanted aggressive style and power. t was decided to capture this in the
cheetah.
A 100-day study to flesh out the product suggested that it should have a monocoque structure (instead of
mounting the body on the chassis, here the two are integrated) for better handling, power of 140-150 horsepower
and high fuel efficiency.

The project was then handed over to a team to make a business case: the costs, the possible volumes and
revenue, and the return on investment.
The report took three to four months to prepare, and was approved by the company's capex committee.
Goenka refuses to divulge the return on investment projected by this team, but says it covers the cost of money -
debt at 12-13 per cent and equity at a higher cost.


Ananthan and her team designed the new SUV all by themselves, the interiors as well as exteriors.
They moved from sketches on paper to computers and finally to full-scale clay models.
These clay models were shown to a group of teenagers, perhaps because they would become potential
customers by the time the SUV was ready, and a group of "prosumers" - people like fashion designers and
writers who can visualise trends that will emerge four or five years later - for feedback.
"We have to live in the future," says Wadhera.

Right through, full secrecy was maintained. Even top Mahindra officers could not enter the design lab with
camera cellphones - they had to deposit them outside.
Prototypes were taken out on the road under camouflage and there were no badges on the grille or back.
Some enthusiasts took pictures of these hooded machines and sent them to :8ine88 Standard Motoring.
w Mahindra deveIoped XUV500. The true story

With some informed guesswork, the :8ine88 Standard Motoring team was able to tell it was the new Mahindra
SUV.
n April this year, Nripjit Singh "Noni" Chawla, the former chief executive of Max Healthcare and now a reader,
photographer and traveller, was invited by Mahindra & Mahindra to see the car.
Chawla is an old enthusiast of Mahindra vehicles, hence the invitation.

He and some others were taken to a secret location where the SUV was kept in an enclosure.
"They allowed us to start the car but we couldn't drive it. They wanted my feedback," says Chawla.
The same month, Mahindra & Mahindra decided to show the SUV to its dealers at the Westin in Pune (it is being
manufactured at Chakan close by).

The SUV was taken in a container to the hotel; though there were over 150 guests, not a single photo or sketch
leaked to the world outside.
The next month, it was driven in containers to Goa for the sales and marketing teams of the company to see it.
Again, nothing came out.

Goenka claims this is the first four-wheeler to be styled totally within ndia.
n the Mahindra & Mahindra stables, the XUV 500 certainly is.
The Armada, out of which grew the olero, was done in Japan, the Scorpio in the United Kingdom and the Xylo
in taly.
For the Xylo, Mahindra & Mahindra vice-chairman & managing director Anand Mahindra had travelled with the
design team to taly; in the new SUV too, he closely monitored the style.

t was important, says Ananthan, to ensure that the new SUV belongs to the Mahindra family.
t would thus have to include some design elements of the Scorpio.
The real challenge was the rear seat: the Scorpio and the Xylo have adequate space in the third row to seat three
people of good height; this gave the SUVs a box-like feel from behind.
Contemporary design has moved to a sloping curve towards the rear. After much debate, it was decided to
sacrifice the third-row's height advantage to get that curve.

y now, Mahindra & Mahindra had also decided that the new SUV would not be a replacement for the Scorpio
but a whole new premium product.
Jejurikar says this helped contain costs because it was originally meant to be in the same price band as the
Scorpio (below Rs 10 lakh).
The target for the price was set at 15 per cent to 20 per cent below SUVs made by multinational car-makers. The
final price was Rs 10.8 lakh for the base model.

Srinivas Krishnan, the editor of :8ine88 Standard Motoring, says this is below the expected price tag of Rs 14
lakh (Rs 1.4 million).
s it strategic pricing? Jejurikar say it isn't; the company is making money at this price.

Also, a higher price would have left a segment open between the Scorpio and it, which rivals like the new Tata
Safari could have moved into.
"The price of Rs 11 lakh (Rs 1.1 million) to Rs 12 lakh (Rs 1.2 million) is the tipping point where a buyer of a C-
segment car like the Honda City may upgrade to an SUV; a higher price becomes forbidding," Jejurikar adds.

For the premium positioning, Wadhera and his team offered to pack in features that come in an SUV of Rs 22
lakh (Rs 2.2 million) to Rs 24 lakh (Rs 2.4 million).
Wadhera lists 48 new features in the SUV that will "win the customer's wow".
His team has applied for 31 patents on the SUV.

Almost 40 per cent of the SUV's cost is the electrical and electronic systems.
Goenka says the harshness of the noise and vibration gave him several anxious moments, as did the fit and
finish of the interiors.
"Till about a month before the launch, we weren't sure if we were there," says he.

The mHawk engine of the Scorpio was tweaked to improve the output from 120 horsepower to 140 horsepower
and the fuel efficiency to 15.1 km to a litre.
All told, Mahindra & Mahindra has spent Rs 850 crore (Rs 8.5 billion) on the project, which includes Rs 200 crore
(Rs 2 billion) on the upgrade of the engine and the transmission.

s the product perfect? Krishnan, who test-drove the XUV 500, says the gearbox is notchy and not very precise.
During the test drive, the steering began to vibrate when the speedometer crossed 110 km per hour.

Once the prototype was ready, it was put through three juries more than once: one was drawn from the
development team, another from the other verticals of the company and the third from outside the company.
Chawla, it is safe to assume, belonged to the third jury.

At the same time, 250 prototypes were driven 2.35 million km over two years in New Zealand, Austria, South
Korea, Dubai (to check the effectiveness of the air-conditioner in extremely hot conditions), Sweden (for
extremely cold conditions), China (it could be a market in the future), South Africa, the US and, of course, ndia.


n ndia, it was driven at Khardung La, the highest road in the world, and was tested for spin, turn and brakes on
the tracks of the Mahindra Research Valley near Chennai.
For almost two years, 125 people tasked to validate the prototypes lived in hotels, away from their families, and
drove their machines day and night.

nstead of giving it a name like olero, Scorpio or Xylo, Goenka and his team decided to go with the alpha-
numeric XUV 500. (nternally, they call it the Five O-O because O at the end of the name has proved lucky for the
company in the past; double O could be doubly lucky, says Jejurikar).


t also gives the company the flexibility to build a family of SUVs around the name: a smaller variant can be
called the XUV 400 and a larger variant the XUV 600.
Also, the Mahindra name that was relegated to the background when the Scorpio was launched because it was a
fuddy-duddy farm-sector brand at that time, has been given a pride of place this time round - the SUV is called
the Mahindra XUV 500.

n the pre-launch social media campaign, Mahindra & Mahindra tried to create excitement about the product but
didn't talk about its features and create expectations.
Clearly, the Nano experience was playing on everybody's mind, where the focus had shifted to the features from
the overall car experience.
The television campaign that accompanied the launch had to be discontinued because of the huge bookings,
says Jejurikar.

At the moment, Mahindra & Mahindra dealers are not taking fresh orders.
The production lines in Chakan are fully booked till mid-January.
Though almost 300 Mahindra & Mahindra employees have opted for the XUV 500 under the company car
scheme, it has been decided to limit their quota to 25 a month.

Recently, 150-odd people from the Mahindra Research Valley were called to a Chennai hotel to celebrate the
success of the XUV 500.
s some cash incentive likely to follow? "t's not yet decided," says Jejurikar, "though there was some small
amount given out when the Xylo was launched."
Till it's decided, the technicians will have to keep their fingers crossed.
Source:

Three years back, Cadbury's Iound itselI in the eye oI a storm, when a Iew instances oI
worms in its Dairy Milk bars were reported in Maharashtra . In less than two weeks, the
company launched a PR campaign Ior the trade. And three months later, came an ad
campaign Ieaturing Big B and a revamped poly-Ilow packaging.
Marketing and communications experts brought together by AICAR and the Subhash
Ghoshal Foundation say that Cadbury moved quickly to bear the cost oI damage. And thanks
to its equity with the consumers, Cadbury's won back consumer conIidence, with hit on sales
notwithstanding.
In October 2003, just a month beIore Diwali , customers in Mumbai complained about
Iinding worms in Cadbury Dairy Milk chocolates. Quick to respond, the Maharashtra Food
and Drug Administration seized the chocolate stocks manuIactured at Cadbury's Pune plant.
In deIense, Cadbury issued a statement that the inIestation was not possible at the
manuIacturing stage and poor storage at the retailers was the most likely cause oI the reported
case oI worms. But the FDA didn't buy that. FDA commisioner, Uttam Khobragade told
CNBC-TV18, "It was presumed that worms got into it at the storage level, but then what
about the packing - packaging was not proper or airtight, either ways it's a manuIacturing
deIect with unhygienic conditions or improper packaging."
That was Iollowed by allegations and counter-allegations between Cadbury and FDA. The
heat oI negative publicity melted Cadbury's sales by 30 per cent, at a time when it sees a
Iestive spike oI 15 per cent. For the Iirst time, Cadbury's advertising went oII air Ior a month
and a halI aIter Diwali, Iollowing the controversy. Consumers seemed to ignore their
chocolate cravings. As a brand under Iire, in October itselI, Cadbury's launched project
'Vishwas' - a education initiative covering 190,000 retailers in key states. But what the
company did in January 2004 is what really helped de-worm the brand.
By investing up to Rs 15 crore (Rs 150 million) on imported machinery, Cadbury's revamped
the packaging oI Dairy Milk. The metallic poly-Ilow, was costlier by 10-15 per cent, but
Cadbury didn't hike the pack price. Bharat Puri, managing director, Cadbury's India says,
"While we're talking about a Iew bars oI the 30 million we sell every month - we believe that
to be a responsible company, consumers need to have complete Iaith in products. So even iI it
calls Ior substantial investment and change, one must not let the consumers conIidence
erode." Simultaneously, Cadbury's roped in brand ambassador Amitabh Bachchan to do some
heavy duty endorsement putting his personal equity on the line Ior the brand.
The company upped ad spends Ior the Jan-March quarter by over 15 per cent. The recovery
began in May 2004, and by June, Cadbury's claimed that consumer conIidence was back.
These experts believe that the reason Ior Cadbury's success was that it took crisis head-on.
And the consumers were more Iorgiving, because the brand enjoyed an emotional equity in
India.
Santosh Desai, Iormer president, McCann-Erickson says, "The nature oI the relationship that
Cadbury's has built with the consumer is responsible Ior latitude the consumers are giving it.
"They are seeing it as a lapse, not a breach oI trust - this diIIerence is key. What Cadbury's set
out to deliver, it gooIed up once but it seemed to be very sincere in its intent to get things
right."
Even so, other experts Ielt Cadbury's was itselI to blame Ior the worm crisis.
Mahnaz Curmally, PR counsel, explains, "Cadbury's had known Ior a long time that
packaging needed change, so in a sense, they waited Ior something to happen beIore they
made that change and perhaps in hindsight, they could have made that change voluntarily."
Cadbury's could be case study oI a sweet recovery Irom a crisis. It continues to lead the
Indian chocolate market with over 70 per cent marketshare. However, the experts Ieel that
today's constantly changing environment should keep the company on guard.

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Bruce Lee, Russell Crowe in The Gladiator, Spiderman, a waterIall, combat

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