A few years ago, Mahindra’s name in Australia meant tractors, workhorse utes and the occasional sighting in a regional town. These days, it’s something altogether different. With the launch of the XUV3XO, the Indian auto maker has formally entered the urban SUV fight, offering a fully-specced compact crossover with big screens, Level 2 driving tech and a price tag that starts at $23,490 drive-away.
Officially launched on 3 July 2025 in Melbourne, the XUV3XO marks Mahindra’s second major SUV release in Australia after the larger XUV700. The new model isn’t trying to be everything to everyone. It is trying to be very good value to everyone, and for a growing slice of budget-conscious Australians, that may be enough.
The specs are ambitious. A turbocharged 1.2-litre petrol engine puts out 82 kilowatts and 200 Newton-metres, paired with a six-speed automatic gearbox. It gets to 60 kilometres an hour in 4.6 seconds, according to Mahindra, and does the 0–100 sprint in about ten. Fuel economy is a respectable 6.5 litres per 100 kilometres. All-wheel disc brakes, six airbags, and a suite of standard Advanced Driver Assistance features—adaptive cruise control, lane-keep assist, forward collision alert and more—come built-in, even on the cheaper AX5L model. That’s not common at this price point.
It also leans heavily on tech: dual 10.25-inch screens, wireless Apple CarPlay and Android Auto, a 360-degree camera system and (on the top variant) a panoramic sunroof. Add to that a modest 3.99-metre body that still fits five people, a boot with 364 litres of cargo space and a commanding 201mm ground clearance, and you begin to see the playbook. It’s practical enough for city school runs, but styled to feel a bit more adventurous.
This is no accident. Mahindra executives say the XUV3XO was built with Australia in mind. According to “Mahindra.com.au”, new models are increasingly tested and tuned using feedback from Australian customers, with design influence coming from Mahindra’s studio in Banbury, UK. The current plan is to roll out at least one new model per year, with upcoming EVs and a redesigned Pik-Up ute scheduled through 2026.
The company’s ambitions go further. After selling just 600 vehicles across Australia in 2021–22, Mahindra reached 4,185 sales in 2024, according to “Drive.com.au”, placing it 32nd in brand rankings, between Chevrolet and Mini. By 2030, the company wants to break into the top 15. Speaking at the XUV3XO launch, Mahindra’s head of international operations, Sachin Arolkar, said the goal was to become “a top five player in each segment” it enters.
Arolkar called the XUV3XO a key piece of that strategy. He expects it to become Mahindra’s best-seller in Australia—overtaking the larger XUV700—until the refreshed ute arrives in 2026. It may sound bold, but the math checks out. With entry-level pricing that undercuts key rivals like the MG ZS, Kia Stonic and Hyundai Venue, the new model lays claim to being Australia’s cheapest SUV, at least for now. Even the higher-spec AX7L sits at just $26,490, drive-away.
That price advantage could narrow. Mahindra is yet to receive an ANCAP crash rating for the XUV3XO, and Australia’s 2026 regulations will require more safety features. Any engineering updates to meet those standards will likely push prices up. For now, though, Mahindra is exploiting a gap in the market: buyers who want high-end features without the badge price tag.
The marketing push is shifting accordingly. According to “GoAuto.com.au”, Mahindra now runs “Adventure” events across five states, inviting customers to off-road weekends and family driving days to boost engagement. The company says its customer base has moved well beyond farmers and tradies. James Halliwell, Mahindra Australia’s marketing head, noted especially strong uptake in Melbourne and Adelaide, and growing interest in Sydney and Perth. Most buyers are younger families, small-business owners and lifestyle seekers. Some are coming from Toyota or Mitsubishi, others from older Mahindra models. Many are just shopping on price.
Whether this is a short-term price play or the beginning of a long-term brand shift remains to be seen. Mahindra still has a relatively small national footprint, with 70 dealerships and plans to add another 10 in six months. Its after-sales and parts network is growing, including a local warehouse for faster turnaround.
There are, of course, limits to the strategy. Brand recognition sits at just 30 percent, according to internal estimates quoted by GoAuto.com.au, and building familiarity will take time. Some buyers may hesitate without an ANCAP rating. Others will want to see how the car performs over three or five years, not just on a press release.
Still, the numbers suggest momentum. Reviews of the XUV3XO have been cautiously optimistic, pointing to strong standard features, clean design and value for money. Dealers have reported high enquiry levels even before the cars hit showrooms. And Mahindra’s previous SUV, the XUV700, generated waiting lists in some cities.
The bigger shift is qualitative. A decade ago, Mahindra’s name in Australia evoked work tools, not daily drivers. Today it offers touchscreen dashboards and Level 2 driving autonomy. That evolution reflects a broader trend in car buying: consumers are less loyal to brands and more focused on features, tech and total cost of ownership. Mahindra’s pitch is built for that shift.
The XUV3XO, then, is a test case. If it succeeds, it won’t just bring more Mahindras onto Australian roads—it could shift how Australians think about emerging brands. Mahindra isn’t quite mainstream yet. But with 4,000 cars sold last year and a budget SUV that ticks many boxes, it’s inching closer to the conversation.
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🚗 @Mahindra_Auto launches @MahindraXUV3XO in Australia with tech-rich feat & drive-away price $23,490.💥 Designed 4 Aussie roads, it targets budget-savvy buyers with style, space & safety.📈 A bold step in Mahindra’s brand evolution. 🌟 #TheIndianSun
🔗 https://t.co/aoywts1nDt pic.twitter.com/7JsAvUUba7
— The Indian Sun (@The_Indian_Sun) July 6, 2025
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