Are Mercedes-Benz, Volkswagen, and Hyundai Ready to Manufacture EVs in India?
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Synopsis
In a significant development for India's automotive industry, major players like Mercedes-Benz, Volkswagen, and Hyundai are ready to invest in local EV manufacturing. This initiative could revolutionize India's position in the global electric vehicle market, aligning with new policies aimed at boosting domestic production.
Key Takeaways
- Mercedes-Benz, Skoda-Volkswagen, Hyundai, and Kia are looking to manufacture EVs in India.
- The SPMEPCI will soon open for applications.
- Investors must commit a minimum of Rs 4,150 crore.
- EV imports will be subject to a cap of 8,000 units annually.
- New policies aim to foster India as a global EV manufacturing hub.
New Delhi, June 2 (NationPress) Union Heavy Industries Minister H D Kumaraswamy announced on Monday that Mercedes-Benz, Skoda-Volkswagen (VW), Hyundai, and Kia have expressed strong interest in producing their electric vehicles (EVs) within India.
The minister added that the application period for the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) will be initiated shortly.
Regarding Tesla, led by Elon Musk, the Union Minister remarked: "We are not currently anticipating any manufacturing from them as they are merely planning to establish showrooms. They have no intentions of manufacturing in India."
The newly introduced EV policy has granted various incentives for companies willing to invest and establish manufacturing operations in India.
The government has now issued guidelines to attract fresh investments from international manufacturers in the electric vehicle sector, positioning India as a global manufacturing center for e-vehicles.
Approved applicants will be permitted to import completely built units (CBUs) of electric four-wheelers valued at a minimum of $35,000 at a reduced customs duty of 15 percent for a duration of 5 years from the date of application approval.
These applicants must commit to an investment of at least Rs 4,150 crore as stipulated by the scheme. The annual import limit for electric four-wheelers at the reduced duty rate will be capped at 8,000 units, with provisions for carrying over any unused annual import quotas.
As per the announcement, the total number of EVs eligible for import under this initiative will be limited to ensure that the maximum duty waiver per applicant does not exceed Rs 6,484 crore, or the applicant's committed investment of at least Rs 4,150 crore, whichever amount is lesser.
In related news, the anticipated increase in steel tariffs by US President Donald Trump is expected to have a "minor" effect on India, as the country does not have significant exports to the US, Kumaraswamy stated.
Trump recently declared a doubling of import tariffs on steel and aluminum from 25 percent to 50 percent, effective June 4.
In a statement to reporters in the capital, Kumaraswamy noted: "There will be some minor impact since we are not exporting (to the US) on a large scale."
Point of View
The interest shown by established automotive brands in India's electric vehicle manufacturing signals a promising future for the country's economy and technological advancement. This aligns with the government's vision of establishing India as a global manufacturing powerhouse in the automotive sector, ensuring sustainable growth and job creation.
NationPress
22/07/2025
Frequently Asked Questions
Which companies are interested in manufacturing EVs in India?
Companies like Mercedes-Benz, Skoda-Volkswagen (VW), Hyundai, and Kia have expressed interest in setting up electric vehicle manufacturing in India.
What is the SPMEPCI?
The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) is an initiative aimed at encouraging the manufacturing of electric vehicles in India.
What are the investment requirements for applicants?
Applicants must invest a minimum of Rs 4,150 crore to qualify under the scheme.
How many EVs can be imported under the new scheme?
The scheme allows a maximum import of 8,000 electric vehicles per year at a reduced duty rate.
What is the impact of US tariffs on India's steel exports?
According to Kumaraswamy, the upcoming steel tariffs by the US will have a 'minor' impact on India as it does not export significantly to the US.
