Mahindra and Mahindra may team up with SsangYong Motor in an attempt to bolster its electric vehicles’ business as rising fuel prices have triggered demand for eco-friendly products.
India’s largest utility vehicle maker plans to collaborate with SsangYong Motor to produce the latter’s electric variant of the crossover model, Korando, signalling the first step towards a synergistic approach, said people with direct knowledge of the development.
SsangYong displayed the electric variant of Korando at the recently concluded Geneva Motors Show. Mahindra, which took management control of SsangYong Motor last month, looks to launch the Korando C and the Rexton for the Indian market in early 2012.
Mumbai-based conglomerate will enhance synergies with South Korean company after Mahindra Reva launches 4-seater NXR in the Indian market shortly. The collaboration is mainly to create products which complement the portfolio of Mahindra Reva, the electric vehicle joint venture between M&M and Reva Electric Company .
Pawan Goenka, president (automotive and farm equipment sector) M and M, said Mahindra Reva is gearing up to launch the NXR soon and widen its electric vehicle portfolio but declined to comment on tie up with Ssangyong. Mahindra Reva’s new manufacturing facility in Bangalore will enhance capacity to 30,000 by 2013-14 from 15,000 units this year. The plant has a maximum capacity to produce 1,500 cars a year and the company is producing 100 cars a month.
Mahindra and Mahindra has been targetting families, who already own a vehicle, as rising fuel prices have burnt a hole in their pockets. “There is also willingness by customers to look at alternative fuel vehicles, thanks to the recent fuel price hikes,” said R Chandramouli, COO, Mahindra Reva. Electric vehicles, which suffer from the twin effects of premium pricing and infrastructure bottlenecks, have become cheaper after the government provided a subsidy of 20 per cent in December 2010.