Mahindra, Ola Electric welcome new EV policy to invite global brands to India

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  • The Centre has approved a new EV policy that is expected to lure foreign brands like Tesla to invest and manufacture in India.
Ola Electric
Indian auto manufacturers like Ola Electric believe that the new EV policy approved by the Centre will help India become the global EV hub of manufacturing and technology.

Indian electric vehicle manufacturers have welcomed the Centre’s decision to lower import taxes to invite foreign EV makers to invest in India and manufacture locally. On Friday (March 15), the Centre had approved a new EV policy which opened the gate for global EV brands to launch in India with the condition to invest a minimum of ₹4,150 crore and deadline of three years to start manufacturing locally. For India, aiming to be the next global hub for electric vehicles, the new policy could see a number of prominent companies like Tesla launching here soon.

India’s largest electric two-wheeler manufacturer Ola Electric and Mahindra, which plans to launch as many as five electric vehicles in India in the next few years, welcomed the Centre’s move. The Centre has promised to reduce EV import duties to 15 per cent for foreign carmakers if they fulfil the government’s condition on investments and local manufacturing. The policy says the imported EV prices should not exceed $35,000 (roughly converted to around ₹29 lakh). The condition restricts foreign EV makers to import no more than 8,000 electric cars to India in a year.

Mahindra and Mahindra issued a statement welcoming the new EV policy, It read, “The recently announced EV policy for new entrants reinforces the Make in India momentum, with requirements of bank guarantees, minimum investment commitment, and local value addition. This will help accelerate the EV ecosystem in India.” The carmaker, known more for its SUVs in India, currently offers XUV400 as the only EV in its lineup. Mahindra also said that first of its upcoming Born Electric SUVs is scheduled for India launch in January next year, most likely during the second edition of Bharat Mobility Global Expo.

Ola Electric too welcomed the new EV policy, calling it a ‘progressive decision’ to lower EV import duties. Bhavish Aggarwal, CEO and founder at Ola Electric, took to social media and said, “This is a win for the Make In India initiative & strengthens our manufacturing ecosystem, propelling India towards a greener future. India will become the global EV hub of manufacturing and technology.” Ola Electric sells the likes of S1 Pro, S1 Air and S1 X electric scooters in India.

Also Read : As India opens door for global EV makers, check out which brands are expected to launch soon

Among global EV makers aiming for a India launch soon, Vitenam-based EV startup VinFast has also reacted to the new EV policy. Pham Sanh Chau, CEO of VinFast India, issued a statement saying, “We highly value the Indian Government’s new EV scheme as it aims to drive large investments in manufacturing, create competencies and upskilling, set up a robust supply chain and offer consumers world-class, zero tailpipe emission vehicles. With a long-term growth commitment in India, we have pledged an expenditure of $500 million.” VinFast is currently setting up an electric vehicle manufacturing facility in Tamil Nadu. It plans to manufacture electric SUVs locally.

The new EV policy is seen as an opportunity for global EV brands like Tesla to launch in India. In fact, Tesla has been the most active among global brands to lobby for a lower EV import duty in India. The efforts, despite Indian EV manufacturers like Tata Motors demanding level-playing field for all, bore fruits finally. Tata Motors is yet to come out with an official statement on the new policy. However, the Centre has put certain conditions that will help to promote local manufacturing as well as bring in foreign carmakers to turn India into a new global EV hub.

First Published Date: 18 Mar 2024, 16:29 PM IST






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VinFast walks Tesla route in India, seeks import duty cut for electric cars

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By: HT Auto Desk
| Updated on: 25 Feb 2024, 15:45 PM

VinFast is currently in the process of constructing a manufacturing facility in the southern state of Tamil Nadu. The company has urged the Indian gov

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Vinfast
Vinfast has urged the Indian government to reconsider the 100% import duty on fully-built EVs. (Bloomberg)

Vietnamese electric vehicle (EV) manufacturer VinFast has approached the Indian government with a request to temporarily reduce import duties on its cars for approximately two years, a report by Reuters stated. This move aims to facilitate customer acceptance of VinFast’s products until the company’s local manufacturing plant becomes operational.

The request aligns with VinFast’s strategy to establish a presence in India, similar to the approach taken by American EV giant Tesla, which had also expressed interest in a duty reduction but faced a denial from the Indian government.

VinFast is currently in the process of constructing a manufacturing facility in the southern state of Tamil Nadu. The company’s India CEO, Pham Sanh Chau, has indicated that production is slated to commence by mid-2023, initially focusing on domestic sales before venturing into exports. VinFast’s investment plans in Tamil Nadu, in collaboration with the state government, entail a total investment of up to $2 billion, with an initial commitment of $500 million for the first five years of operations.

VinFast, akin to Tesla, has urged the Indian government to reconsider the 100% import duty on fully-built EVs, a stance that has been met with opposition from domestic automakers. While India, as the world’s third-largest vehicle market, is contemplating the requests, no definitive decision has been reached yet, as per a government official.

Also Read : Centre yet to finalise import tax on EVs as Tesla gets ready for India

Chau highlighted VinFast’s proposal for a temporary reduction in import duty, suggesting bringing it down to 70% to 80% for a limited number of cars over two years. This approach, he believes, will help Indian customers acclimatise to VinFast’s offerings. While the central government deliberates on this proposal, VinFast remains committed to advancing its manufacturing facility’s construction.

India’s EV market is still nascent, accounting for just about 2% of total car sales in the previous year. However, the federal government has set an ambitious target of achieving a 30% market share for EVs by 2030, and is actively working on programs to attract EV manufacturers.

VinFast’s Tamil Nadu project is expected to have an annual capacity of up to 150,000 vehicles, complementing its main plant in Vietnam with a capacity of 250,000 vehicles annually. The company is already collaborating with around 55 Indian dealers to establish a robust sales network and is also considering introducing its two-wheeler models in the country in the future.

First Published Date: 25 Feb 2024, 15:45 PM IST

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Vietnam’s Vinfast to establish EV facilities in Tamil Nadu, makes big promises

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By: HT Auto Desk
| Updated on: 07 Jan 2024, 21:53 PM

  • VinFast will establish EV and battery manufacturing facilities in Thoothukudi and says these will generate around 3,500 jobs.
VinFast
Officials from VinFast are seen here with Tamil Nadu CM MK Stalin and Union Minister Piyush Goyal at the signing of a joint agreement between the EV maker and the state government. (CMO, Tamil Nadu)

VinFast is fast emerging as a name and brand to reckon with in the world of electric vehicles (EVs). The company from Vietnam has already expanded its presence across many markets across the world, including the United States, and has now confirmed its India entry via a mammoth $2 billion investment into EV facilities in Tamil Nadu.

In an official statement, Vinfast announced it has an intended commitment of $500 million for the first five years of the project and that it has signed a joint agreement with the state government of Tamil Nadu. The construction of a battery plant and a facility to manufacture EVs will begin from this calendar year itself – in Tamil Nadu’s Thoothukudi – and once both are fully functional, will generate up to 3,500 jobs in the state.

Entering the Indian market at this point in time may be as beneficial for VinFast as it could be to accelerate the EV adoption in India. India is the world’s third largest car market in the world – in terms of sales, but EV penetration is still quite small. What this may mean is enormous potential that VinFast is looking to tap into. And choosing Tamil Nadu as its base of operations in the country is stemming from its assessment that the state has enormous potential to be India’s EV hub. “VinFast Tamil Nadu project aims to evolve into a first-class electric vehicle production hub in the region, with an annual capacity of up to 150,000 units. Construction of the plant is anticipated to begin in 2024. This project is set forth to lay a strong foundation for economic growth in Tamil Nadu and India as a whole,” the company said in its official statement. “Besides the economic benefits, the project will also pave the way for green transportation development, targeting 30% of newly registered private cars to be electric. This aligns with the state government’s initiatives to minimize carbon emissions in the transportation sector.”

Vinfast
File photo of Vinfast VF9 electric vehicle on the opening day of the Geneva International Motor Show that was held in Qatar in 2023. (Bloomberg)

How significant is VinFast in the world of EVs?

VinFast is one of the newer players in the globa EV race and comes from a country that has traditionally not had much to show in terms of its automobile manufacturing capabilities. But the EV game has levelled the play-field significantly, providing opportunities for established automobile champions as well as emerging EV companies.

Founded in 2017 by Pham Nhat Vuong, Vietnam’s first billionaire and who made his riches as a property developer, VinFast has been manufacturing EVs since 2021. It may have only been over two years of manufacturing EVs but VinFast has been busy. The company bought a manufacturing facility from GM in Australia while it is working to open another production hub in Indonesia that is scheduled to start rolling out models from 2026 onwards. It also began shipping its EVs to the US in early 2023 and opened its first dealership in the country last month. It is also establishing a manufacturing plant in North Carolina and is investing $4 billion in the country.

What kind of EVs does VinFast offer at present?

VinFast EV models are quite striking in their exterior design language even if the specifications are not the best in the industry just yet. The company offers small electric models like VF3 and VF4, as well as large electric SUVs like VF7 and VF9. The likes of VF6 and VF7 are sub-compact and compact SUVs, respectively, while VF8 is a mid-size SUV.

First Published Date: 07 Jan 2024, 21:47 PM IST

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