The joint venture between JSW and Chinese carmaker SAIC Motor Corporation plans to approach the government for support under the production-linked incentive (PLI) scheme for automobiles, which ends in 2027-28 (FY28), after achieving the localisation target.
In an exclusive interview with Business Standard, Anurag Mehrotra, managing director of JSW MG Motor India, said: “Localisation is our first priority. Once we achieve the target, we will look at getting support through schemes like PLI. We are not pushing localisation only to get PLI, but it is key for us in mitigating challenges related to foreign exchange and freight costs.”
He said the company aims to achieve 70 per cent localisation within 12 to 18 months, and several of its cars, including the Comet electric vehicle (EV), have already crossed the 50 per cent localisation mark.
This is significant because, under the current PLI scheme for electric four-wheelers, companies need over 50 per cent localisation to qualify for incentives of 13-18 per cent on sales. Competitors, including Tata Motors and Mahindra & Mahindra, already have some eligible models under the scheme. However, other eligible players such as Hyundai, Kia, and Suzuki do not yet have any model cleared for PLI incentives.
To execute its three-pronged strategy, the company has received board approval to invest up to ₹4,000 crore in expanding its existing Halol plant. Apart from localisation, the investment will also go towards increasing production capacity from the current 120,000 units per annum to 170,000 units per annum by the end of FY27, and further to 300,000 units per annum by FY28.
The company will also use the funds to launch four new car models this year, one of which will be positioned in the premium segment above ₹50 lakh. The new launches will include a hybrid model, while other will be electric.
On the growth of the EV market this year, Mehrotra said: “The penetration of electric cars is rising. It was at 5 per cent in the last financial year and crossed 6 per cent in April. We expect it to end this financial year at 8 per cent penetration.”
It has also taken a clear call to focus on new energy vehicles, though it will continue to offer internal combustion engine vehicles as well. Mehrotra said: “Last year, we sold 72,000 vehicles, of which 80 per cent were electric. We introduced battery-as-a-service to reduce the upfront entry cost, and it already accounts for 10-12 per cent of our total sales. It took some time for consumers to adopt it.”
Next big drive begins at home
