Mahindra Expands SUV and EV Portfolio with AI Integration and Capacity Growth by FY27

Mahindra & Mahindra (M&M) is accelerating its use of artificial intelligence (AI) across all business areas, with AI applications in place for nearly two years. The company has outlined a long-term strategy to strengthen its FY27 plan, focusing on expanding its SUV and electric vehicle (EV) portfolio, increasing production capacity, and building an export pipeline with AI support.

Key Highlights

• Mahindra targets mid to high teen SUV growth by FY27
• SUV production capacity to increase by 18,000 units per month by FY27
• Ten new ICE and six new EV SUV launches planned by 2031
• Mahindra sold 55,000 electric SUVs since launch with 7,400 9S units in Q4
• AI used to improve manufacturing and customer engagement across operations

Growth Plans and Capacity Expansion

M&M is in close competition with Tata Motors for second and third place in the automotive market. By FY27, Mahindra expects mid-to-high-teens growth in SUV sales, driven by new model launches and expanded production. Rajesh Jejurikar, Executive Director and CEO of Auto and Farm Sector, stated that the company aims for mid to high teen growth in SUVs for FY27.

At the end of FY26, Mahindra Automotive had a monthly SUV production capacity of 64,500 units, including 56,000 internal combustion engine (ICE) units and 8,000 EV units. The company plans to add 4,000 units to its monthly capacity soon. By the end of FY27, Mahindra will add another 14,000 units per month, supporting new launches and increased EV volumes. This includes capacity for the upcoming NU_IQ platform. The Nagpur facility is expected to be operational by mid-2028, with land acquisition underway.

Product Launches and Market Expansion

Mahindra plans to launch 10 new ICE models and six new EV SUVs by 2031. In the light commercial vehicle (LCV) segment, 10 new launches are planned in the same period. The XUV700 7XO averaged 9,500 units per month in production during January, February, and March.

Since launch, Mahindra has sold 55,000 electric SUVs, with the 9S model accounting for 7,400 units in Q4. The company expects to resolve near-term capacity constraints for the 9S within four to five months. In FY26, the automotive business contributed the most to group performance, with revenue rising nearly 30% year-on-year to ₹1,17,834.13 crore, up from ₹90,824.58 crore in FY25.

Export and Farm Equipment Strategy

Exports remain a priority, with Mahindra evaluating two to three right-hand-drive markets as initial targets for its electric SUVs. Expansion to left-hand-drive European markets will follow in phases. The company expects to enter a couple of right-hand-drive countries with EVs within the next year and a half.

In the farm equipment sector, Mahindra forecasts mid-single-digit growth for the tractor industry in FY27, depending on monsoon conditions. The company achieved a record quarterly market share of 43.6% in Q4, with core tractor margins at 20.54% for the quarter and 20.8% for FY26. To meet demand, Mahindra plans 19 new automotive products this fiscal year, including seven new launches and 12 feature upgrades under the Mahindra and Swaraj brands.

AI Integration and Process Improvement

Mahindra is using AI to improve manufacturing quality, speed up product development, and enhance customer experience. For the XUV700 launch, AI enabled 17,000 test drives by reaching out to potential customers in multiple languages. These AI initiatives focus on improving core processes rather than creating standalone technology products.