Mahindra & Mahindra is evaluating a fourth SUV price hike this year to offset rising commodity costs. Despite previous increases, the company reports steady booking volumes and is expanding production capacity to 84,000 units per month to support upcoming model launches.
Mahindra & Mahindra is assessing the possibility of another price increase for its SUV portfolio, a move that would mark the fourth such hike for the automaker in 2026. After implementing price adjustments in January, April, and July, the company is now monitoring volatility in raw material markets to decide its next step. According to Nalinikanth Gollagunta, President and CEO of the Automotive division, a final decision on whether to raise prices is expected within the next two weeks.
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The company is looking to protect its profit margins as it navigates the impact of commodity cost inflation. Automotive manufacturers often pass on increased costs of inputs like steel and aluminum to consumers to maintain operational efficiency. Despite the consecutive rounds of price hikes throughout the year, the company notes that customer inquiries and booking numbers remain stable. Management believes that vehicle pricing, even after these adjustments, remains competitive when compared to the tax-inclusive pricing landscape that existed before the implementation of the Goods and Services Tax.
Expanding Monthly Capacity to 84,000 Units
To handle strong demand and prepare for future model rollouts, the company is scaling its production capabilities. Currently, the manufacturer operates at a monthly capacity of 60,000 internal combustion engine (ICE) vehicles and 8,000 electric vehicles (EVs). By the end of March or early April, the firm aims to increase its total monthly production capacity to 84,000 units. This plan involves scaling the ICE segment to 70,000 units and the EV segment to 12,000 units. This expansion is critical for the company to reduce waiting periods, which can often lead to potential customers cancelling bookings and shifting to competitors like Tata Motors or Maruti Suzuki.
Aligning Product Strategy with CAFE Norms
The company is also finalizing plans for two major product launches scheduled for the upcoming two quarters, covering both ICE and EV platforms. While some industry players are betting on a mix of hybrids and electric vehicles, Mahindra & Mahindra maintains a firm focus on its pure-electric trajectory. The management argues that this strategy is better aligned with government incentives and the stringent Corporate Average Fuel Efficiency (CAFE) norms. These regulations provide a clear regulatory advantage to battery-electric vehicles over hybrid technology, which the company expects will drive growth for its EV ecosystem. Investors will likely track the company's ability to maintain its SUV market share while simultaneously absorbing or passing on commodity cost pressures, as well as the successful execution of the planned capacity expansion and the reception of upcoming new model launches.