India’s Mahindra & Mahindra could consider investing in a battery-cell company to meet future electrification plan of action, the Managing Director and CEO of the Mahindra Group said, after the company raised funds for its electric vehicle (EV) segment at a USD 9.1 billion valuation.
Mahindra raised USD 250 million from British International Investment for the unit and is looking at establishing a partnership with Volkswagen AG to source such EV components as batteries and motors.
While the partnership with Volkswagen will help Mahindra meet its short to medium-term battery needs, Mahindra CEO Anish Shah stated that the company was open to looking at some kind of investment with an international leader in the battery-cell space if required to secure future supplies.
Shah stated that the company did not intend to manufacture batteries. He added that the company aims to partner with those who already manufacture batteries as a possible co-investor and ruled out owning and running such an operation.
Mahindra plans to unveil five electric sport-utility vehicles
As part of its electrification plans, the company aims to launch five electric sport-utility vehicles over the next several years. The aim of these models is to contribute up to 30 percent, or about 200,000 units, of its total annual SUV sales by March 2027.
With a growing demand for battery-powered EVs and shortage of supply chains across the globe, automakers are looking at ways of having greater control over supplies and costs. Some are even spending billions of dollars on factories and mines for motors and batteries – an exit from years of relying solely on suppliers.
Automakers are also wary of situations such as the pandemic shortage of semiconductors that could lead to production stoppages. Supply glitches continue to cause order backlogs in several companies.
Shah mentioned that apart from batteries and motors, most of the components for EVs were not very different from those of combustion-engine cars and Mahindra has produced a majority of those parts in-house.
Shah stated that if an investment was required to procure battery supplies, the company was ready to do so.
The company’s strategy originated as Indian companies seek to capitalise on billions of dollars’ worth of incentives being offered by the government to build EVs, part of a policy to meet nationwide climate change and carbon reduction goals.
India’s EV market, dominated by India-based carmaker Tata Motors, represents only 1 percent of the country’s annual sales of about 3 million vehicles. The government wants this to rise to 30 percent by 2030.
About Mahindra & Mahindra Limited
Mahindra & Mahindra (M&M) is an Indian multinational automotive manufacturing corporation, which was established in 1945. The company’s journey commenced with them getting into the steel business, and over time, they expanded to 22 key industries. A need for change in the agricultural practices pushed them to foray into that sector right before the agriculture revolution initiated in India. Mahindra developed into one of the key torch-bearers of the IT revolution in the country. Their focus now lies in developing alternate energy sources because they accept that true energy conservation will play a huge role in ensuring a better future, for not just India and its communities, but the entire world.