Q&A: Mahindra’s Beguiristain

NEW YORK When Americans think of Indian exports, most would probably be hard-pressed to think beyond Bollywood and the country’s celebrated scientific and technological expertise. Alpharetta, Ga.-based car importer Global Vehicles USA has ambitious plans to add automotive production to that list.

Next year, the company plans to introduce the first Indian car brand to the United States, Mahindra.

While Mahindra & Mahindra has been making cars for more than 50 years and is the largest SUV maker in India, it is virtually unknown to most Americans and the business climate couldn’t be more challenging for a new car entering the battered U.S. automotive market. Despite the global economic crises and inflated gas prices, Xavier Beguiristain, who leads U.S. advertising and marketing, says the timing for Mahindra’s high-torque, fuel-efficient diesel engine truck line, set to hit the U.S. late next year, may be just right.

The company, which hired StrawberryFrog early this year, plans to invest an estimated $60 million in media to advertise the new brand. Beguiristain talks about Mahindra’s strategy and plans in the following Q&A.

This seems like the worst economic condition to import a foreign car brand into the U.S., particularly for a maker of trucks and SUVs, the segment that has suffered most from increasing gas prices.
A: The timing actually works in our favor. We have a two-door and four-door pickup that gets 30 mpg. There is nothing else like that out there. If you look at the very low end Tacoma, you are probably going to get 25 miles on the gallon.

What are your sales goals?
Our system is a pull system vs. a push system. We are going to build the number of vehicles ordered, so we don’t have to go out there and say we have to sell x number of vehicles.

What is your distribution system?
We have over 325 dealers. Consumers want to make sure they can actually have the vehicle serviced. We want to make sure we are covering the country.

Who is the target for this line?
People who have a progressive mind-set. People who are forward-thinking are more receptive to a new foreign car brand. That represents about 17 million people. We’re looking for a sliver of this. … They are hardworking people, outdoorsy, the type of people who go out to a football game rather than watch it on TV.

What did your research find when exploring consumer feelings towards foreign car brands and India in particular?
We found something that surprised us: These people all carried passports and all traveled outside of the U.S. in the last year. When you start talking about acceptance of foreign car brands, they all said the same thing: The Japanese are here, the Germans are here. They are used to foreign cars.

But those brands have long been established here.
Mahindra already has a tractor business here. By the time we launch, we’ll have 80,000 people who are loyal to the brand. That’s the really low-hanging fruit, they already know the brand, they know diesel and they are loyal. We know we have a great target.

What challenges do you foresee in convincing Americans to embrace a car produced in India?
When you talk about India, your mind can go a lot of different places. But when you think about the fact that India produces more engineers than the U.S., your mind is at a higher level. They are going to go to both places — very intelligent people, doctors, engineers, a lot of poverty. One of the things we understand from a marketing perspective is that we have to put a language around it that gets people to the higher level of what it is.

You are working with StrawberryFrog on the advertising. When can we expect communications to begin and what’s your strategy?
We are working on finalizing the overall brand strategy. We’re looking at April before we start pushing some of that out. We want to build an audience slow with a lot of grass-roots efforts and build up a group of enthusiasts. We really want to give people the opportunity to experience the brand in innovative ways. We’re working on trying to create a global brand image for Mahindra and we want to make sure that we are in line with that brand image. I think StrawberryFrog has come up with something that is spectacular. I think they’ve come through for us on that.