How JSW Group’s foray into the EV space can change the industry

It’s not over till it’s over. This adage perfectly captures the story of Ford’s exit from India. The US automaker decided to shut shop here in September 2021. It has managed to find a buyer in Tata Motors for its relatively new plant in Sanand at a price tag of Rs 725 crore. But its 25-year-old Maraimalai Nagar plant in Chennai, which has been shut since July 2022, is a different story.

Several buyers, including Vietnamese electric carmaker VinFast, have shown interest. More recently, the JSW Group, which is keen to diversify into the EV space, has emerged as a potential bidder. Reportedly, the diversified conglomerate is also in talks to acquire a majority stake in MG Motor India. For JSW, the apparent plan is to also simultaneously work on making its own EVs. This is where Ford’s Maraimalai Nagar plant, with an annual production capacity of around 200,000 units, perhaps fits into its plans. But nothing concrete has materialised yet.

Gaurav Vangaal, Associate Director at S&P Global Mobility, points out that MG Motor India already has a production factory in Halol, with an annual production capacity of 120,000 units. “If JSW Group does indeed acquire the Chinese carmaker as well as the Chennai factory, it immediately puts pressure on them to utilise a capacity of 300,000 units a year when India’s EV consumption is yet to mature.”

Nevertheless, the factory continues to be an attractive option for carmakers because it is located in Maraimalai Nagar, near Oragadam and Sriperumbudur, where leading automakers Renault-Nissan, Royal Enfield, Hyundai, BMW and Yamaha already operate.

“Although Hosur is the EV hub currently, the Maraimalai Nagar plant is also attractive, simply because it is readily available and factory modifications to suit production requirements would work out to be more economical than a greenfield project. Plus, it’s close to the Chennai port,” says Vangaal.

While it’s all about location at the Ford plant, it continues to wait for a buyer.

@SaysVidya