Mahindra sees E-SUVs make up 30% of its sales by FY2027

Bombay : Mahindra and Mahindra Ltd has set an ambitious target of achieving 20-30% of its total electric sports utility vehicle (SUV) sales over the next five years, with the automaker set to start selling the first of five SUVs electricity at the beginning of the next year.

To propel its electric initiatives, M&M on Thursday announced an investment of 1,925 crore ($250 million) from British International Investment (BII) in its newly incorporated wholly owned EV unit. The UK government’s development finance institution will invest in mandatory convertible instruments for a 2.75-4.76% stake in the new company at a valuation of up to 70,070 crores. M&M will also invest an equal amount in the entity focusing on the production of four-wheel electric vehicles.

Overall, the Mumbai-based automaker announced a total capital injection of 8,000 crore in the electric vehicle business in FY24-27, and BII and company investments will fund this initiative.

M&M’s ambitious plans come as the automaker seeks to further entrench itself in India’s growing electric vehicle market. Considered a pioneer in India’s electric vehicle industry, M&M took a majority stake in Bengaluru-based The Reva Electric Car Co. Ltd in 2010 and renamed it Mahindra Reva Electric Vehicles Pvt. Ltd, which made the e2o small electric car. In 2016, M&M renamed the company Mahindra Electric Mobility.

Meanwhile, the Indian electric vehicle industry is witnessing rapid changes, supported by government incentives and the launch of new models. Tata Motors Ltd is now the leading maker of electric vehicles with top-selling models like the Nexon compact SUV and Tigor compact sedan. Others, like MG Motor India and Hyundai Motor India, also sell electric vehicles in addition to luxury brands like Mercedes-Benz and Audi.

“The electric SUV segment is at an inflection point. Several data suggest that the penetration of electric SUVs will increase considerably over the next three years. Market research has indicated that 85% of Indians want to go electric, and this percentage is among the highest in the world. We expect that by FY27 we will achieve approximately 20-30% penetration of our electric SUV portfolio,” said Rajesh Jejurikar, executive director of automotive and agriculture at M&M, during a briefing. Friday press conference.

M&M currently produces a range of electric three-wheelers and small utility vehicles. However, these vehicles will not be part of the new EV company.

To subscribe to Mint Bulletins

* Enter a valid email

* Thank you for subscribing to our newsletter.

Sallie R. Loera