Utility vehicle major Mahindra & Mahindra (M&M) is developing a mini SUV for India with Ssangyong, the South Korean SUV maker it acquired last year. Codenamed the S101, the ‘Nano’ SUV, as it is being dubbed by some workers on M&M’s shop floors will be powered by 1-1.2 litre petrol engines and 1.5-litre diesel engines. Work on the project began a year ago, say people working on it; and the vehicles are expected to roll out of M&M’s plant in Chakan on the outskirts of Pune, where the newly launched XUV500 is being produced in 26-28 months. The estimated price range of the mini SUV is between Rs 3 lakh and Rs 4 lakh.
The price tag is noteworthy because most mini-SUVs - typically under 4 metres in length - are premium products. The Jeep Wrangler, Nissan Juke and Skoda Yeti are some of the best-selling mini and compact SUVs globally, yet their pricing is clearly premium - the Yeti, for instance, sells in India at over Rs 14 lakh.
If M&M can pull off the S101 at the stated price, it would make it the only mini-SUV in that price range anywhere in the world. To persist with the Nano analogy, it would do for SUVs what Tata Motors has done for cars by opening up an altogether new ultra low cost category.
The S101 project is also the first joint development effort by the M&M-Ssangyong combine. For the South Korean maker of sports utility vehicles, the low-cost segment is alien, and hence a welcome addition to its range.
There’s another reason both M&M and Ssangyong are keen on this segment: In India, passenger vehicles under 4 metres fitted with 1.2-litre petrol and 1.5-litre diesel engines attract a lower excise duty of 10 percent (for larger cars it is 22 percent). In South Korea, the vehicle will have a turbo-charged sub-1 litre engine as this segment does not attract a levy except for a 10 percent value-added tax.
When contacted, an M&M spokesperson said that as a matter of policy the company does not comment on future plans. "Work on a new platform should be concluded very soon and it will be on the compact side", said Rajan Wadhera, chief executive, technology, product development & sourcing, M&M. He refused to divulge specific details. He added that the project is at the styling and customer research stage and technocommercial viability has to be established. People close to the development say the platform will be monocoque (or unibody) and the plan is to have different body shells for M&M and Ssangyong vehicles.
M&M has set up a team of over 100 engineers who are working on various functions of styling, body design, trims, vehicle integration, suspensions, engine development and cooling systems. The company is relying on value engineering and software solutions to keep development costs low.