3 Min Read
MUMBAI (Reuters) - Automaker Mahindra & Mahindra (MAHM.NS) will invest in building long-range electric vehicles, high-power battery packs and power trains in an effort to boost green car sales, senior company executives said on Wednesday.
Mahindra plans to ramp up production of its electric vehicles to 5,000 units a month by mid-2019 from 400 units currently and will invest in making batteries that enable cars to run for 400 kilometres on a single charge, managing director Pawan Goenka said.
He did not disclose the investment Mahindra would make.
The announcement comes days after a government think-tank released a policy blueprint favouring electric vehicles, which could influence a new green car policy.
"We said we will be waiting for the vision for electric vehicles ... We hope we will be the pioneers in terms of the people who promoted electric vehicles use in India," Goenka told reporters, adding that the company is working with the government on framing new policies for electric vehicles.
Despite being the country's sole electric passenger vehicles maker, Mahindra has struggled to boost sales due to high battery costs of around $270 per kilowatt hour, a dearth of charging stations and low buyer interest.
Mahindra entered the electric vehicle business in 2010 by acquiring Bengaluru-based Reva Electric Car Co and has sold only 2,700 vehicles since, including the e2o small car and eVerito sedan.
"There is a viability gap ... If we can reduce cost by 20 percent then we can ramp up faster," he said, adding that only substantial cost reduction would make electric vehicles commercially viable.
The company currently makes batteries that allow cars to run between 100 and 140 kilometres on a single charge. It is working to increase the range to 200 kilometres first and then to 400 kilometres, said Babu.
The government's push for green cars will help Mahindra, said Abdul Majeed, automotive leader at PwC India. But to meet their target, the company would need to think about how to bring down battery costs and increase the range, he said.
($1 = 64.8600 Indian rupees)
Writing by Aditi Shah; Editing by Vyas Mohan