SAIC’s India venture ramps up $440m push on hybrids and EVs

JSW MG Motor, the automotive joint venture backed by China’s SAIC Motor and the Mumbai-based JSW Group, has announced plans to invest up to $440 million to scale up manufacturing capacity in India and accelerate its product lineup towards hybrid and electric vehicles. The company aims to lift annual output to 300,000 units from about 120,000 at its Halol, Gujarat plant while rolling out three to four new models focused on new-energy platforms.

The investment, which Managing Director Anurag Mehrotra says will be funded through a mix of internal accruals and external financing, underscores the venture’s strategic push into electrification even as it continues to struggle to turn a profit. JSW MG Motor reported losses of about $121 million in its latest financial year while sales climbed to around 70,500 vehicles, largely supported by demand for its Windsor EV model.

Mehrotra told reporters that the company expects new-energy vehicles — a term it uses for hybrids and EVs — to account for at least 75 per cent of its own product portfolio. He also projected that these vehicles could represent roughly 30 per cent of total vehicle sales in India by 2030, up from about 5 per cent currently, signalling the scale of transition it envisages in the market.

The expansion plan comes against a backdrop of evolving geopolitical and trade dynamics that have complicated growth for Chinese automotive players in India. Since 2020, New Delhi has placed restrictions on Chinese outbound investment as part of broader efforts to recalibrate economic ties, a policy environment that has weighed on SAIC’s ambitions. The firm sold a minority stake in its India operation to JSW in 2024 as part of efforts to raise capital and sustain operations amid these constraints.

Industry analysts see the infusion of capital and fresh vehicle platforms as critical to the company’s ability to compete in a market where Japanese and European manufacturers have longstanding production footprints and are committing billions of dollars to capacity and product expansion. Toyota and Suzuki, for example, have both announced multi-billion-dollar investments in local production, while Renault has been reviving its presence in the country.

JSW Group’s role in the venture adds another dimension to the strategy. The conglomerate, headed by Chairman Sajjan Jindal, secured a 35 per cent stake in what was formerly MG Motor India after SAIC restructured ownership arrangements. The partnership has broader ambitions beyond the immediate production boost, with plans under the banner of JSW Green Mobility to develop integrated EV and battery manufacturing facilities, including battery plants and related component units in states such as Odisha and Maharashtra.

Those projects are intended to build a more resilient supply chain and support localisation, a thrust that could help the company reduce its reliance on imported components and exposure to foreign exchange volatility. Mehrotra highlighted localisation as a “biggest unlock” for profitability, emphasising reduced costs from diminished import dependency and freight outlays.

Rising competition in the domestic new-energy segment adds pressure and opportunity. Indian buyers are showing greater appetite for electrified vehicles, aided by government incentives and an expanding charging infrastructure. Domestic manufacturers such as Tata Motors and Mahindra & Mahindra have been early movers, while global players including Hyundai and Kia have also deepened their EV offerings. Market observers note that hitting ambitious EV sales targets will require continued investment in technology, supply chains, and marketing to shift consumer perception and usage patterns.

Despite the investment announcement and growth in unit sales, JSW MG Motor’s financial performance highlights the challenges ahead. With cash reserves reported at about $60 million and outstanding borrowings of $344 million, the company is balancing scale ambitions with the need to chart a path to profitability. Mehrotra indicated that the company is weighing debt and equity options to support the expansion but that internal cash flow should suffice for the current year’s commitments.