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Mahindra launched the XUV500 with utmost enthusiasm but never did the company predict that the SUV would see such a huge demand. The situation has become so bad that the company had to resort to a lucky draw for the Mahindra XUV500, when the second phase of bookings were opened last month. The initial production was 2000 units per month and is being hiked to 3000 units per month with effect from March 2012. However, this too is not enough considering the high demand of the flagship Mahindra vehicle.
Thus Mahindra has decided to raise the capacity of production by another 2000 units. Currently the installed capacity is 3000 units which is insufficient to meet the domestic demand. Mahindra has also frozen exports of the XUV500 to clear local demand. The company will invest close to Rs. 100 crore to increase monthly production capacity of the Mahindra XUV500 to 5000 units, which will help meet the demand without having to resort to lucky draws. By the end of the year Mahindra is expected to clear all backlogs for the XUV500, after which the car should be available off the shelf in early 2013. Mahindra is expected to offer an automatic version of the XUV by the end of the year, as well as commencing exports of this global model.
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