Mahindra exploring options to meet revised diesel engine norms
The recent Supreme Court ruling banning the sale of diesel vehicles with engine capacities above 2000cc in Delhi & the neighbouring NCR region has hit Mahindra hard. The largest SUV manufacturer in the country has a total of five products affected by the recent orders. As reports of a similar ban being extended to other regions around the country make the rounds, Mahindra is evaluating all types of options to emerge above them.
Apart from the Bolero, which is the highest selling SUV in the country, the other Mahindra products with an engine capacity above 2000cc include the XUV500, the Scorpio, Thar & the Xylo. The manufacturer is looking at a downward revision in engine capacities on those motors which are just above the cut-off mark. The 2.2 litre mHawk engine that powers their flagship SUV, the XUV500 is a prime candidate for such an exercise.
From a feasibility point-of-view, engine downsizing attempts can be successful only if they’re within certain technical parameters. A loss of power would be inevitable but manufacturers should be able to negate at-least some, if not of this through the advanced engine calibration tools that they have at their disposal these days. What is likely to create a few hurdles is alterations that would have to be made in terms of associated parts and engine sub-systems. Vehicle manufacturers would have to work closely with their suppliers to ensure that there are no glitches by way of these changes. Then there is the whole cost-angle to the issue. Downsizing an existing engine would mean reduction in the size of the pistons used, the crankshaft assembly and associated components.
Mahindra is no stranger to ad-hoc regulation changes in production guidelines. About two years ago, the SUV manufacturer had to reduce the high ground clearance to meet the excise benefits for the year. But this time, things are slightly different. It isn’t as much a problem pertaining to Delhi & the NCR region. The uncertainty in the environment is regarding similar diktats being enforced in other markets around the country.
Meanwhile, the company is busy grappling with a more immediate problem. The unsold inventory that is piled up with the dealers in the affected areas is said to be in the region of a hundred crores. The Mahindra management will have to somehow shift this out of the region, to neighbouring markets before it gets sold. Apart from the added logistical hassles in such a manoeuvre, it is the financial hit that will likely affect the company.
The dilemma over sub-2000cc diesel engines is affecting Mahindra severely at the moment. However it is the entire auto-manufacturing industry that has had their confidence rattled, with perhaps the market leader, Maruti Suzuki India Limited, being the only significant exception.
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