Chinese Automaker SAIC Preps EV for India

MUMBAI – Chinese government-owned automaker SAIC expands into India with the formation of a new subsidiary called MG Motor India.

MG Motor plans to launch its Indian venture by 2019 and launch its first product, an electric car tentatively called the Morris Garages, the following year. EVs are among the so-called

new-energy vehicles that include hybrid-electric and plug-in hybrid-electric models and whose development and sales are being aggressively promoted by the Chinese government.

MG stands for Morris Garages, a U.K. marque SAIC acquired in 2007.

MG Motor eventually will offer a full range of cars and SUVs built to meet global quality standards and Indian emissions norms, and to operate under Indian driving and traffic conditions. Sales projections are not available, but by entering India the automaker seeks a share of what is projected to be the world’s third-biggest car market by 2020.

“The introduction of the iconic British sports car brand MG is an important part of SAIC Motor’s new global strategy,” SAIC says in a statement. “Our aim is to provide best-in-class vehicles, integrating sophisticated British design and quality, breakthrough product features and a pleasing ownership experience.”

SAIC has named two former top General Motors India executives, Rajeev Chaba and P Balendran, as president-managing director and executive director, respectively, of MG Motor India.

MG Motor is evaluating whether to build a new plant or use the Halol plant formerly occupied by General Motors India. SAIC has told GMI it would consider taking over that facility only if it is free of all encumbrances, including liabilities to workers or creditors, and of warranty obligations on the nearly 300,000 GMI cars sold during the past five years.

MG Motor and various Indian state governments are discussing alternative locations and incentives or concessions for siting a new plant.

A recent government report proposes lower taxes and interest rates on EVs and hybrids. Mahindra & Mahindra, currently India’s only EV producer, is struggling because of scant buyer interest and minimal charging infrastructure, but it is working with the government to develop and install charging stations across the country. Automakers including Toyota, Hyundai and Maruti are more interested in promoting hybrid sales.

MG expects to generate sizeable business and employment opportunities under Indian government initiatives to launch new cars with innovative features and create a lively, competitive contemporary market.

Besides creating, enlarging and maintaining a presence in the Indian market, the fledgling automaker will develop an export strategy to reach out to the entire range of global markets from Australia and New Zealand, to the Middle East and Africa, and finally to Mexico and South America.