Aiming to meet future electrification needs, Mahindra & Mahindra might consider investing in a battery-cell company, its CEO said, after the company raised funds for its new electric vehicle unit at a $9.1 billion valuation.
Mahindra raised $250 million from British International Investment for the unit this Thursday and is also looking into a partnership with Volkswagen AG to source EV components such as batteries and motors.
Even though one of its options, Volkswagen, would meet Mahindra’s “short to medium term” battery needs, however, Mahindra CEO Anish Shah said the company was open to looking at some sort of “investment with a global leader” in the battery-cell space if it needed to secure future supplies.
In an interview, Shah said, "Our intent is not to get into (manufacturing) batteries," he further added, "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."
Additionally, Mahindra plans to launch five electric sport-utility vehicles (SUVs) over the next coming years. These models are expected to contribute to its total annual SUV sales by up to 30%, or about 200,000 units, by March 2027
With the growing demand for EVs and disruption of supply chains all over the globe are pushing automakers to look at ways of having greater control over supplies and costs. Various carmakers are spending billions of dollars on mines and factories for motors and batteries, a result of years of relying only on suppliers.
Due to the supply problems, many companies are still facing order backlogs, making them wary of situations like the pandemic, and semiconductor shortages that lead up to production shortages.
Furthermore, Shah said that, except for batteries and motors, most of the components for EVs were not very different from those of combustion-engine cars and Mahindra produced a majority of those parts in the country.
"If we can get an agreement as 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," he said.
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