Skoda-Volkswagen Now Talking To Tata And JSW For Electric Cars: Mahindra Deal Off!
Last year, it was reported that Skoda Auto Volkswagen India was planning to join hands with Mahindra Automotive to develop and launch new electric cars in India. Well, it has now been reported that this partnership might not be going through. Instead, the company is now looking to partner with Tata Motors and JSW MG Motor for a potential EV platform license agreement. This will help the brand launch new electric vehicles in India, which will help them increase their market share in the country.
Mahindra and Skoda Auto Volkswagen India deal is off
As per the reports, SAVWIPL (Skoda Auto Volkswagen India Private Limited) and Mahindra Automotive were in talks for a joint venture to produce electric vehicles in India. In this joint venture, both companies would have had an equal stake share. However, there were a number of key disagreements between the two brands.
It has been highlighted that there were valuation disagreements, vehicle platform-sharing complexities, and differing key terms. Due to these issues, the joint venture has been officially called off. However, there are reports that mention SAVWIPL is still open to licensing the INGLO skateboard electric architecture, which has been developed in-house by Mahindra Automotive.
Skoda Auto Volkswagen now talking to Tata and JSW MG
Although it may seem like the joint venture failure with Mahindra Automotive has set back SAVWIPL, that is not the case. The reason behind this is that the company is now in talks with the country's largest electric four-wheeler manufacturer, Tata Motors, and JSW MG Motor India. Reportedly, SAVWIPL could enter a licensing agreement with either of the two automakers.
Presently, Tata Motors is gearing up for the launch of the new Harrier.ev, Safari.ev, and Sierra.ev in India. All of these SUVs are based on its Acti.ev architecture. However, whether Tata Motors will agree to this licensing agreement has not been finalized, as no one from Tata Motors has commented on this topic.
Additionally, JSW MG Motor, which already has a joint venture with the China-based automotive giant SAIC Motor, has also not commented on whether it will be entering a partnership with Skoda Auto Volkswagen. At the moment, JSW MG Motor is planning to launch a few new electric cars, commercial vehicles, and manufacture batteries in India.
Why does SAVWIPL want to launch EVs in India?
Presently, the electric vehicle market in India is still in its early stages, and sales are growing. So, in order to grab a piece of the electric vehicle segment cake, Skoda Auto Volkswagen wants to launch electric cars in India. In addition to this, both companies want to increase their market share in the country, as they both have only a few products in India that cater to the mass market.
Apart from these reasons, Skoda Auto Volkswagen India also wants to improve its Corporate Average Fuel Efficiency (CAFE III) ratings before stricter emission norms come into effect in India. Lastly, it would cost Skoda Auto Volkswagen India close to Rs 8,700+ crore to develop and launch an all-new electric car in India.
However, if it can get a licensing agreement, its cost would come down significantly. Now, whether these talks between Skoda Auto Volkswagen India and other major Indian automakers come to fruition or not will be found out in the coming months.