Indian steel conglomerate JSW is reportedly in discussions with the Volkswagen Group to forge a joint venture aimed at manufacturing electric vehicles in India. This news comes alongside reports suggesting that Volkswagen is contemplating the potential sale of its Indian subsidiary, Skoda Auto Volkswagen India.
Initial reports surfaced on Moneycontrol, drawing from sources familiar with the ongoing negotiations. According to these sources, talks commenced earlier this month and are progressing towards an exclusivity arrangement, indicating that both parties may soon commit solely to each other for partnership discussions, sidelining other potential collaborators.
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While specifics regarding the negotiations remain undisclosed, insiders hint at Volkswagen’s inclination towards divesting its stake in Skoda Auto Volkswagen India. The German automaker appears keen on establishing fresh collaborations within India’s electric vehicle market.
Historically, Skoda Auto has spearheaded Volkswagen Group’s operations in India. Responding to queries, a spokesperson for the manufacturer labeled the reports as speculative, affirming that official statements would follow at a later stage. Nonetheless, earlier affirmations from the India unit head hinted at Volkswagen Group’s intentions to introduce a budget-friendly electric SUV in India, slated for launch in the latter half of this decade, with potential exports to other markets.
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Piyush Arora, CEO of Skoda Auto Volkswagen India, echoed these sentiments in a statement to Reuters, affirming their active pursuit of an entry-level electric vehicle. “We are actively working on an entry-level electric vehicle. We are looking at which VW Group platform is best suited to build a compact electric SUV in India,” he stated.
Meanwhile, Volkswagen is concurrently engaged in streamlining its electric vehicle platforms globally. Reports indicate efforts towards simplifying the Modular Electric Drive Matrix (MEB) for the production of €25,000 models like the upcoming ID.2 in Europe, along with potential collaborations with Renault for a €20,000 model. The company is also collaborating with partners in China to develop cost-effective e-platforms.
Despite earlier delays in the planned supply of MEB components to Indian car manufacturer Mahindra, recent reports confirm the finalization of the supply deal.
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JSW, on its part, disclosed plans this month to invest 400 billion rupees (approximately 4.47 billion euros) towards establishing a battery and electric vehicle production facility in Odisha, India. This move aligns with JSW’s broader strategy, as evidenced by its recent agreement with MG Motor India, the Indian arm of Chinese automaker SAIC Motor, to jointly develop electric vehicles.
The unfolding negotiations between JSW and Volkswagen signify a pivotal moment in India’s electric vehicle landscape, poised to reshape the industry’s dynamics while underscoring the nation’s emergence as a global hub for sustainable mobility solutions.
