We will take our total capacity to 3 lakh units per year, says Rajeev Chaba, head of MG Motor India
We will take our total capacity to 3 lakh units per year, says Rajeev Chaba, head of MG Motor India
According to a top company official, MG Motor India plans to invest around Rs 4,000 crore in a second manufacturing unit, for which it is in talks with several state governments, including Gujarat.
The company, which is expanding the annual production capacity of its existing plant in Halol, Gujarat to 1.25 lakh units by 2023, plans to add 1.75 lakh units of capacity from the second plant and take its total capacity to 3 lakh units per annum. . next two years.
“Over 1.25 lakh (in Halol), we need a second plant. It may happen in Halol, and we are in touch with the Gujarat government for some additional land. Also, some other states have approached us. So, we have now started our due diligence regarding the location of the second plant. We are meeting some other states as well as the Gujarat government, MG Motor India Chairman and Managing Director Rajiv Chaba told PTI. are.
He added, “There were some offers for the existing brownfield plants. We have not rejected it. I think by the end of June we hope to finalize the second plant.”
When asked about the investment and production capacity for the second plant, he said, “We are looking for around Rs 4,000 crore for the second plant. We will take our total capacity to 3 lakh units per annum, of which 1.75. Lakh units are coming. This.” On the expected completion timeline for the new unit, Mr Chaba said, “We are talking about finalizing it by June, and once it is finalized, it will take us about two years.”
In terms of financing the second plant, Mr Chaba said the company is looking at several avenues including ECB (external commercial borrowing) and FDI (foreign direct investment).
“We are looking at all possible options to raise funds, including FDI, ECB and other investors. All options, we are looking at, wherever we can get a good deal. Our FDI application is still with the government. ECB we We can get it and in fact, we are getting some ECBs.”
Last year, MG Motor India announced an investment of Rs 2,500 crore to increase production capacity at its Halol plant.
“At the Halol plant itself, we have made fresh further investments to increase the capacity from 70,000 per annum to Rs 1.25 lakh per annum,” Mr. Chaba said.
In 2021, the company sold 40,000 vehicles, he said, adding, “This year, we have a huge shortage of chips, but still we think we will eliminate 70,000 units. So our progress is from 40,000 units last year, to 70,000 units.” 1.25 lakh units this year and next year.”
To reach these production targets at the plant, he said, “we have started the second shift from this month and the plant will produce 1.25 lakh units annually on a three-shift basis from next year.” The company currently produces four models – Hector, Gloster, Astor and ZS EV from its Halol plant. With the capacity addition, he said the supply of these vehicles would increase.
“The fifth one that we are going to launch by March-April next year is a small EV priced between ₹10 lakh and ₹15 lakh. Hence, these five products should take care of 1.25 lakh units at the Halol plant , and then on the sixth the product will have to come to the new plant,” Mr Chaba said.