It was when Pawan Goenka stepped into the first prototype of Mahindra and Mahindra Ltd’s (M&M) next-generation Scorpio 18 months ago that the idea seized him: Why not make the company’s next sports utility vehicle (SUV) more than just an upgrade of the Scorpio?

In fact, why not build a vehicle the company could even sell in overseas markets, thought Goenka, president of the automotive and farm equipment division at M&M, a $14.4 billion group with business interests in automobiles, information technology, banking and holiday resorts.

By then, M&M had already spent two-and-a-half years developing what was intended to be the next generation Scorpio, which cemented M&M’s place in the utility vehicle (UV) market after its introduction in 2002. The decision to build an entirely new product meant a hasty return to the drawing board.

The result was the XUV500 , the first vehicle developed in India with an eye on international markets. It took Rs.650 crore to develop the vehicle, which finally opened for bookings in India on 1 October.

Ten days and 9,000 purchases later, M&M had to stop taking customer orders because demand far outstripped supply.

Plans to sell the car overseas were put on hold until domestic demand is satiated, and M&M is in the process of doubling production capacity at its factory in Chakan, Pune, to 4,000 units a month.

To be sure, automobile industry experts aren’t reading too much into theXUV500 ’s initial success in the Indian market, where it has been pitted against the Toyota Fortuner, the Honda CR-V and the Tata Aria, among others, in assessing the international prospects of a product M&M wants to sell in more than 30 countries across the world.