Australia’s cheapest SUV could cop price rise due to new safety standards
The new Mahindra XUV 3XO may lose the title of Australia’s most affordable SUV next year after it receives upgrades to meet more stringent 2026 protocols from safety authority ANCAP.
Speaking at the launch of the Mahindra XUV 3XO – a city-sized five-door compact SUV to rival the Chery Tiggo 4 and Mazda CX-3 – Mahindra head of international operations Sachin Arolkar said the new regulations would force the price of the XUV 3XO upwards.
In doing, so the automaker risks losing the XUV 3XO’s title as Australia’s lowest-priced SUV.
The XUV 3XO is being launched this month without an ANCAP safety rating, and while it has a five-star crash test result from Indian safety authority Bharat NCAP, the automaker confirmed that the vehicle landing in showrooms from July 4 doesn’t meet the new 2026 ANCAP requirements.
Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now.
“We actually need to make a few adjustments to the vehicles to meet the new protocols,” said Mahindra Australia marketing boss James Halliwell during a media briefing.
While he didn’t disclose the changes, when asked by CarExpert if meeting the new protocols will push up the price of the XUV 3XO, Mr Arolkar replied: “My guess is yes”.
“Obviously there’s going to be changes which require investments on the product – and I’m not completely on with it in terms of the changes from a material cost perspective – but just in terms of investments required, yes.”
“I’m not planning to elaborate on that – it’s still a work in progress; we’ll come back to you on that.”
Therefore the price of the XUV 3XO could eclipse that of the model it replaced as Australia’s cheapest SUV in the country, the Chery Tiggo 4, which has the same $23,990 drive-away price as the Mahindra once the latter’s introductory pricing ends on August 31.
The Tiggo 4 is at an advantage as it has both its $23,990 price and also a five-star ANCAP safety rating achieved in 2023.
“The current [XUV 3XO] car is not ANCAP [rated] – the new developments which are happening on our entire portfolio for Australia are in the light of the 2026 norms,” Mr Arolkar said.
“We are evaluating all the new [Mahindra] products in the light of the 2026 ANCAP norms, because it’s very important for us to be up-to-date.”
Mahindra has developed its own crash lab in India, a market in which safety has often taken a back seat to price, with a heavy investment to create models that meet global safety requirements.
“The Mahindra XUV 3XO is entering a very competitive segment with a competitive price tag, and while some may suggest safety isn’t important for the smaller end of the market, in fact the opposite is true,” ANCAP CEO Carla Hoorweg told CarExpert.
“It is positive to hear Mahindra are working to bring safety improvements to their future model lineup, but consumers should be aware that – until independent safety testing is undertaken – the safety performance of any new model arriving in our market is unknown.”
The range-wide push for five-star safety ratings in 2026 comes after the brand was caught short with a zero-star ANCAP rating on its Scorpio off-road SUV in 2023.
The Scorpio has since been joined in local Mahindra showrooms by the XUV700 mid-size SUV – which like the 3XO is not ANCAP-rated – with the Pik-Up S10 dropped after it didn’t meet new side-impact safety regulations introduced in late 2022.
A new Pik-up is due in local showrooms in 2026 with a keen focus from Mahindra on obtaining a five-star rating, given the Ford Ranger, BYD Shark 6, GWM Cannon Alpha and other utes currently boast five-star ANCAP ratings .
Mr Halliwell said the XUV 3XO landing in local dealers this month is still a safe vehicle, and Mahindra previously said it was designed for ‘real world safety’ instead of ANCAP requirements.
“Given the new protocol is not very far away, there’s no point in launching a vehicle with [all of] the testing [carried out] and spending a whole bunch of money on the current [ANCAP] standard when it’s changing in six months’ time.”
The XUV 3XO is a critical new model for Mahindra, which it predicts will be its best-selling model in Australia given the size of the small SUV segment here.
The changes to ANCAP’s new protocols for 2026 include new three-year cycles between changing testing requirements, as well as a new moving object test.
“The moving object test in Australia is a very critical one for safety globally, because not only are you protecting your occupants – which we’ve always done – you now need to show the adverse impact on the object that you’re hitting,” Mr Halliwell said.
“Designing a vehicle to meet those two requirements is almost contradictory in its engineering.”
MORE: Explore the Mahindra showroom
Leave a Comment