India’s Mahindra & Mahindra could consider investing in a battery-cell company to meet future electrification needs, its CEO said, after the company raised funds for its new electric vehicle (EV) unit at $9.1 billion (roughly Rs. 7,11,00,000 crore) valuation.
Mahindra on Thursday raised $250 million(roughly Rs. 19,831,650,000 crores) from British International Investment for the unit and is exploring a partnership with Volkswagen AG to source such EV components as batteries and motors.
While the Volkswagen deal would meet Mahindra’s “short to medium term” battery needs, Mahindra CEO Anish Shah said the company was open to looking at some sort of “investment with a global leader” in the battery-cell space if it needed to secure future supplies.
“Our intent is not to get into (manufacturing) batteries,” Shah said in an interview. “There are people who do it very well. We can partner with them; we could be a co-investor in some form. We don’t need to own it and run it.”
Automakers are also wary of situations like the pandemic semiconductor shortage that lead to production stoppages. Many companies still face order backlogs because of supply problems.
Shah said that, except for batteries and motors, most of the components for EVs were not very different from those of combustion-engine cars and Mahindra produced a majority of those parts in-house.
“If we can get an agreement as we have with Volkswagen to secure (battery) supplies, that’s what we will do. If there’s some investment we need to make to secure those supplies, we will do that,” he said.
Mahindra’s plans come 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 national climate change and carbon reduction goals.
India’s EV market, dominated by local carmaker Tata Motors, represents only 1 per cent of the country’s annual sales of about 3 million vehicles. The government wants this to grow to 30 per cent by 2030.
