Mahindra and Volkswagen Group might be on the verge to close a deal forming a joint venture, wherein Volkswagen Group will sell a part of its 100% stake in Skoda Auto Volkswagen India Private Limited to Mahindra & Mahindra.
The main objective of this 50:50 joint venture, if formed, will be to jointly develop and manufacture electric cars for the Indian markets as well as for exports. The models developed under this JV will be made at the OEMs’ Chakan plants.
Skoda Auto Volkswagen India Pvt. Ltd. will benefit from Mahindra’s understanding of the Indian consumer and the market. The Volkswagen Group is also keen to capitalise on its local manufacturing units.
Mahindra & Mahindra will benefit from Volkswagen’s know-how about electric vehicle technology. Both the OEMs will share costs, technology and platforms for new product development.
Mahindra and Volkswagen are currently in a partnership that they entered into in February 2024, after signing a term sheet in 2022. Under this partnership, Volkswagen supplies Mahindra & Mahindra unified battery cells and other EV components for Mahindra’s INGLO platform. The total lifetime volume agreed under this deal is (about) 50GWh.
Mahindra & Mahindra had a joint venture with Renault in the past under which the Mahindra Verito/Renault Logan was launched in India. A prospective venture with Ford was called-off after advanced talks. The outcome of Mahindra’s new venture is yet to be predicted.
Amid rumours of Volkswagen leaving India, Ashish Gupta, Brand Director, Volkswagen India, recently confirmed that the brand has no intention to exit the Indian market. Skoda and Volkswagen also export made in India cars to markets such as South Africa and GCC countries.