You have consolidated the Ssangyong acquisitionin 2011. Is M&M also keen to take over the assets of the troubled Swedish company Saab?
We would not like to comment on speculations. We are, however, open to acquisitions. M&A has to be an enabler of our strategy. If the strategy is to be global and world-class, we should look at both organic and inorganic ways. We are eyeing acquisitions in the automotive side. And on the tractor front, our goal is to remain No. 1 as we have been the world No. 1 on the volumes front for two to three years. So, we will have to build on that.
How do you plan to beat the downturn in theautomobile industry?
The best thing to do to overcome the gravity of some of the macro-economic and the micro-economic factors is to have winning products and that comes from innovation and offering value-for-money products, and that is going to be our effort in the every segment that we focus on.
Having value-for-money products like XUV 5OO, Scorpio and Xylo have helped insulate us from the downturn. We will continue to launch more products which are value-for-money and which will help further insulate us from the downturn. We are also translating the value-for-money proposition in the two-wheeler and the commercial vehicle business.
Auto Expo 2012: Full Coverage
M&M's commercial vehicle and two-wheeler units are yet to achieve good growth. What is your strategy to spur these businesses?
Both these industries are oligopolistic in nature. It takes time to get in to communicate your value proposition, so sometimes it takes much longer than one would want. If there is anybody who can make a reasonable assault in these segments and has resources, brand and competence and can carve out a space and make a dent in this oligopolistic industry, it is Mahindra & Mahindra. We are committed to both these segments and our focus will be on technology and R&D.
Do you think a change in approach could have made some difference ?
Don't forget both these segments are start-ups, and these are good start ups in areas that we understand. Everybody now understands that start-ups are not about budgets. You can't make budgets like you do for mature businesses, which you understand. What you do is make a plan and then you have a very quick and small learning (curve).
What is your view on the government's silence on diesel pricing policy?
Our position on the diesel tax is very clear. I think it is a distorted way of dealing with the subsidy problem. In any good system, one should use resources in an appropriate logical manner. You cannot compensate for the distortion created by subsidy by individually slapping duty at consumption point.
Ultimately, that will distort the economy and not create a conducive environment for growth. I think, the government at some point will have to catch the bull by its horns and take the decision to correct the pricing (gap) between petrol and diesel in an appropriate manner.
What is the outlook for the industry in 2012?
I think the industry will always have winners and losers. So, you will always see some parts of the industry doing extremely well and some parts simply conforming to the average growth which has slowed down. That will obviously depend on products. It depends on new product launches, but on product relaunches as well.
Auto Expo 2012: Full Coverage
Do you see any signs of revival?
I think it depends to a very large extent on factors like interest rates. The interest rate increase, although done to conquer inflation, unfortunately had a disproportionate impact on the vehicle sales because it is a very important element in purchase. The deputy governor (of RBI) has indicated that we have reached the ceiling of interest rates. That's good, but he hasn't told us when he is going to do that (ease rates).
No comments:
Post a Comment