The CEO of India’s carmaker Mahindra & Mahindra said his company is looking to find a battery-maker in whom to invest, to help his company acquire the batteries they will need to secure their electrification supply for future EV’s the company will produce.
Mahindra just raised $250 million last week from British International Investment for its new electric vehicle unit, at a $9.1 billion valuation. Now they are looking for a battery maker to invest in and build a relationship with. The carmaker noted it is presently exploring a partnership with Volkswagen AG to source batteries and EV components.
However Mahindra views any potential Volkswagen deal as a short to medium term solution, and is really looking for some sort of “investment with a global leader” designed to help it secure a permanent source of supplies.
Mahindra CEO Anish Shah said, “Our intent is not to get into (manufacturing) batteries. There are people who do it very well. We can partner with them; we could be a co-investor in some form. We don’t need to own it and run it.”
Mahindra has plans to offer five different Sport Utility EVs over the next few years. It is hoped they will ultimately comprise around 30%, or 200,000 units, of total yearly SUV sales by March 2027.
Chastened by pandemic shortages that stopped production lines cold, manufacturers today are often taking full control of their EV battery production and supply, even spending billions of dollars on mines for the rare earth metals, and building battery and motor factories entirely dedicated to supplying their operations.
Shah noted that the majority of an EV consists of parts that are similar to those used on their production combustion engine cars, and Mahindra already produces all of those parts, in-house.
He said, “If we can get an agreement like we have with Volkswagen to secure (battery) supplies, that’s what we will do. If there’s some investment we need to make to secure those supplies, we will do that.”
Mahindra, like many car companies, is eager to take advantage of billions of dollars in incentives the government is offering to transition from combustion engine vehicles to EV’s, to meet carbon-reduction and climate change rules.
The EV market in India is presently dominated by Tata motors. However total EV sales comprise only about 1% of the 3 million vehicles sold per year. The government has stated their goal is to grow that to 30% by the year 2030.
