Mahindra and Mahindra (M&M), India’s fourth-largest automaker, is in discussions with the Kerala government to establish an electric vehicle (EV) manufacturing unit in the state, which is noted for its high EV adoption.
On Friday, a Reuters report suggested that M&M and China’s Shaanxi had agreed to a $3 billion joint venture to build a car manufacturing plant in Gujarat, pending approval from New Delhi. However, M&M later dismissed the report as baseless.
Kerala Industries Minister P Rajeeve confirmed that discussions with M&M are ongoing. “Some companies from outside the country are looking at Kerala because it has the largest EV market in India. Mahindra representatives are expected for further talks next week,” Rajeeve told a newspaper.
Success in these discussions could be a significant boost for Kerala’s industrial sector, especially ahead of the state’s planned Global Investment Meet (GIM) in February 2024. Kerala currently leads the country in passenger vehicle EV penetration at 5.2%, ahead of Delhi’s 3.2% and Karnataka’s 3.1%, according to a BNP Paribas report.
The state also tops the list for electric two-wheeler penetration at 13.5%, surpassing Karnataka, Maharashtra, and Delhi. Kerala’s infrastructure, including the Vizhinjam container port, positions it well in the EV sector.
Rajeeve highlighted that Kerala has already developed a charging ecosystem and that the state-owned Kerala Automobiles Ltd has produced an electric auto-rickshaw. He also mentioned ongoing talks with other companies to establish manufacturing units in the state.
As part of its preparations for the GIM, Kerala will hold roadshows in cities like Chennai, Bengaluru, Mumbai, and Delhi to showcase its potential as a high-tech hub. The state plans to focus on knowledge-based industries, leveraging its skilled workforce.
Kerala has identified 22 priority sectors, including AI, blockchain, data analysis, machine learning, robotics, and nanotechnology. Rajeeve emphasized Kerala’s economic strengths, noting that while the state occupies only 1.2% of India’s total land area and houses 2.8% of its population, it contributes 4% of the national GDP and ranks as the ninth-largest economy in the country with a high per capita income.
Earlier in the day, M&M issued a statement clarifying that reports about its plans in Gujarat were false, stating that the article in question was unfounded.
