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China's SAIC Motor to drive in an electric SUV in India

MG Motor India, its wholly owned arm, will roll out a locally manufactured vehicle by first half of 2020

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SAIC Motor Corp, the largest automaker of China, is betting big on the prospect of electric vehicles in India.

MG Motor India, a wholly-owned arm of SAIC, will roll out a locally manufactured pure-electric SUV by first half of 2020, within one year of its first product launch in the country,

The Chinese conglomerate had taken over the Halol plant of General Motors in 2017 with the exit of the American carmaker and announced plans to launch its maiden product for the Indian market, an SUV, in the second quarter of 2019.

The electric SUV would the second vehicle to be introduced within a year of that launch, and would be a mass-produced, SAIC's global management said on Monday.

"We will launch a globally-competitive pure-electric SUV in India. The pure electric SUV will be a breakthrough chapter in the EV space in India, being one-of-its-kind in the market. This is in addition to the first SUV, which we plan to launch in the second quarter of next year," Michael Yang, executive director of, international business of SAIC Motor said.

Unsure of government incentive, market acceptance, price sensitivity and critical need of infrastructure like charging stations, most major automobile makers have been non-committal on manufacturing with the government still reworking on the upgrade of 2015 policy on 'Faster Adoption and Manufacturing of Hybrid and Electric vehicles.

The government is now thinking of restricting its incentive to batteries only, a high-cost component, rather than on the whole vehicle.

"Considering probable demand, nobody would put up a battery manufacturing plant, but SAIC, with its collaboration with one of the few global manufacturers, CATL of China, is developing batteries in an economical way," Rajeev Chaba, president and managing director, MG Motor said unveiling MG Motor's India plant at its Shanghai facility.

SAIC has been at the forefront of the development of electric, connected and autonomous cars and some of the products are also set to be manufactured in India.

"We plan to launch one new vehicle every successive year in a five-year period following our first product launch next year and we plan to fully utilise the 80,000 vehicle Halol plant in a year's time. In the next phase, we might launch CVs and buses," Chaba said.

MG Motor is already in the process of finalising around 45 dealers to begin its sales next year, with around 100 touch points across India in the first phase.

"We would be restricting the number of dealers, allowing each one to grow with us instead of restricting their size and expanding the number of dealerships, thus leading to unhealthy competition among them, which ultimately leads to hurting the brand image due to discounting," Chaba said.

MG Motor's management is hopeful of cracking the domestic market, so as to not remain a marginal player under the shadow of behemoth Maruti Suzuki.

"The past failure of some of the global players have taught us the lesson about what not to do in India. Our commitment shows that we are here for the long haul as a significant player," he said.

The vehicles would have a significant localisation level with Halol having a major vendor base, many of whom would be existing arms of SAIC.

IN THE RACE

  • The Chinese conglomerate plan to launch its maiden product for the Indian market, an SUV, in the second quarter of 2019
     
  • The vehicles would have a significant localisation level with Halol having a major vendor base, many of whom would be existing arms of SAIC
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