Mahindra To Set Up New EV Subsidiary, Raises Rs 1,925 Crore Investment From British International Investment

Mahindra has revealed that it plans to set up a new, yet-to-be-incorporated, EV subsidiary company which it is referring to as EV Co. The carmaker said that it had entered into an agreement with UK-based British International Investment (BII) to invest up to Rs 1,925 crore into the company over two stages with the latter gaining between a 2.75-4.76% share in the new company. Mahindra itself will also be investing up to Rs 1,925 crore into the new subsidiary. The upcoming EV subsidiary has been valued in at up to Rs 70,070 crore and will focus on the electric four-wheeler segment with Mahindra targeting to develop “a world-class electric SUV portfolio with advanced technologies.” The new EV subsidiary is also expected to receive further funding of up to Rs 8,000 crore by FY2027 for its product portfolio development. The company also confirmed that the new XUV400 – the all-electric SUV based on the XUV300 would debut in September this year.

“BII’s anchor investment will be key to attracting additional sources of private capital into this exciting venture with the Mahindra Group. The acceleration of EV development in India will be critical to supporting the country in reaching its emission targets as well as improving air quality in many urban areas. Mahindra will play a central role in the decarbonisation of the automotive industry in India and elsewhere,” said BII CEO Nick O’Donohoe.

Also see: Mahindra To Explore More Partnerships For EV Parts

Mahindra teased a trio of EV concepts earlier in the year with more details to be announced on August 15

In a regulatory filing Mahindra said that it planned to transfer all its identifiable ‘Four Wheel Passenger Electric Vehicle Business’ assest to the new subsidiary. The new firm would also benefit from its parent company’s manufacturing capabilities, product development, design organizations and network of dealers, suppliers and financiers.

The first round of BII's capital investments are expected to be completed by June 2023.

Speaking on the announcement Dr Anish Shah, MD & CEO, Mahindra & Mahindra Ltd. said: “We are extremely delighted to have BII as a partner in our SUV electric journey. In BII, we have found a like-minded long-term partner who is committed to combating the climate emergency. The Mahindra Group aims to be Planet Positive by 2040. Mahindra has been a pioneer in the electric vehicles space, and we are confident we will be the leaders in the electric SUV market in the future.”

Also see: Mahindra eXUV300 Electric SUV Launch Confirmed For 2023

Mahindra is set to launch the all-electric derivative of the XUV300 in India this financial year. The model is expected to be called the XUV400

Mahindra has big plans for the electric vehicle segment in India in the coming years with the company targeting to have 20% to 30% of its sales to come from EVs by 2027. The firm earlier this year teased a trio of ‘Born Electric’ electric vehicle concepts expected to preview the company’s new-gen electric vehicles as well as confirming plans to launch the all-electric derivative of the XUV300, the XUV400 in India during this financial year. The company is set to reveal more details on its new ‘Born Electric’ models on August 15, 2022.

Also see: Volkswagen, Mahindra Explore Partnership For Electric Vehicle Components

“Mahindra has very exciting plans to be a leader in the electric SUV space. We would share our vision that includes our comprehensive product, technology, and platform strategy at the UK event on 15 August 2022,” said Rajesh Jejurikar, Executive Director – Auto & Farm Sector, Mahindra and Mahindra.