“In the next three years we are looking at deploying Rs 37,000 crore of cash. A large part of that is going into the auto vertical,” Shah told reporters in an earnings conference.
The company is not going to ignore internal combustion engine (ICE) models as they continue to be an important part of the company’s product portfolio. “It is going to be important for consumers over the next five to seven years,” he said.
Focus on ICE Models and EV Segment
While emphasizing the importance of ICE models in the current market scenario, Shah stated that they remain a crucial part of the company’s product lineup. He highlighted that ICE vehicles are expected to remain important for consumers for the next five to seven years.
The company has allocated Rs 27,000 crore for the auto division between FY25 and FY27, with Rs 14,000 crore dedicated to the ICE vertical for new model introductions and refreshed versions of existing models. The goal is to enhance the SUV portfolio and ensure a strong market presence.
Investment in EVs and Other Verticals
In addition to ICE vehicles, Mahindra Group is investing Rs 12,000 crore in the electric vehicle (EV) segment. Shah expressed confidence in the auto business’s ability to generate sufficient cash internally, eliminating the need for external funding for these investments. The company also plans to invest Rs 5,000 crore each in its farm and services businesses.Expansion of Manufacturing Capacity
Rajesh Jejurikar, Executive Director & CEO (Auto and Farm Sector) at M&M, revealed plans to increase the manufacturing capacity of SUVs from 49,000 units per month to 64,000 units per month by next year. By the end of FY26, the company aims to achieve a manufacturing capacity of around 72,000 units per month.
M&M Executive Director & CEO (Auto and Farm Sector) Rajesh Jejurikar said the company plans to enhance the manufacturing capacity of its SUVs from 49,000 units a month currently to 64,000 units a month by next year end.
“At the end of FY26, we expect it to be in the range of 72, 000 units per month,” he added.
Answering a query he, noted that M&M is looking at “mid to high teens” sales growth this fiscal for its SUVs, which is expected to be higher than the industry growth, Jejurikar stated.
The company currently has pending orders for 2.2 lakh vehicles and the focus is to execute these and reduce the waiting period, he said.
When asked if hybrids should get government support in terms of lower GST, Shah said: “I know there has been a lot of debate on this but government incentives typically are to enable an industry to transition to a place that is better for the economy.”
Focus on Sustainability and Future Mobility
Shah highlighted the global trend of governments incentivizing electric vehicles due to their zero emissions. He noted that while there has been debate about providing incentives for hybrids, governments worldwide have largely stopped offering incentives for hybrids in the past 20 years. However, Mahindra Group remains open to the possibility of launching hybrid vehicles in the future if consumer demand warrants it.
On whether M&M would consider launching hybrid vehicles, Shah said, “Now, from a consumer demand standpoint, if that becomes a bigger factor, we will be ready for that. So we view hybrid as an extension of ICE… And to the extent if that’s required we’ll be ready for that.”
Asked about India’s new EV policy, he said welcomed it saying it is geared towards ‘Make in India’ initiative.
“We’ve always been saying that we should encourage all automakers to Make in India, we welcome competition. We’ve got a much better with competition. We thrive with competition. So we’re very happy for competition to come to India,” he stated.
India’s EV Policy and ‘Make in India’ Initiative
Shah welcomed India’s new EV policy, stating that it is aligned with the ‘Make in India’ initiative. He emphasized the importance of encouraging all automakers to manufacture in India, expressing confidence in Mahindra Group’s ability to thrive and excel in a competitive market.
(With inputs from PTI)