Volkswagen is making faster progress than expected in its cooperation with the Indian car manufacturer Mahindra. A few months after the preliminary contract the partners are already talking about deepening the partnership by supplying components for the platform technology for electric cars developed by the Wolfsburg-based company.
Accordingly, possibilities of cooperation up to a strategic alliance are now being explored, as the two companies announced on Monday. As part of the supply agreement, a volume of more than one million units over the period of one vehicle generation and the delivery of a total of five electric SUV models with MEB components is aimed for. At its peak, Mahindra wants to equip 300,000 electric cars a year with Volkswagen parts. A binding supply contract should be in place by the end of the year.
The two companies are further examining whether they can also work together in other fields – including additional vehicle projects or battery cell production in India. Volkswagen’s chief technology officer, Thomas Schmall, would have the cells built by partners. In addition to six plants in Europe, he already wants to build at least one plant in North America.
Volkswagen uses its MEB platform (modular electric drive system) in many all-electric Group models, but also markets the technical basis of the cars to other car manufacturers. ford for example wants to build at least two models based on MEB.
“The partnership shows that our platform business is fully competitive and that the MEB is on the way to becoming one of the leading open platforms for e-mobility,” said Schmall. Together, Volkswagen and Mahindra could make a significant contribution to the electrification of India, a huge automotive market with ambitious climate protection goals.
With around three million new registrations every year, the Indian car market is one of the five largest car markets in the world. Mahindra expects an electric share in India of 50 percent by 2030. The sales figures there could then rise to up to 4 million cars. The largest car market in the world in China but the country is lagging behind. The market in India is considered to be highly competitive and Indian car buyers are very price sensitive.
Various attempts by VW to gain a foothold in the country with cheap cars have so far failed. For some time now, the Czech subsidiary Skoda has been responsible for the operational supervision of business in the country. VW has high hopes for the future growth prospects in the country with around 1.4 billion inhabitants – also at electric cars.