JSW Group And SAIC Motor Forge Strategic Partnership To Drive MG Motor’s Green Mobility Revolution in India
The Sajjan Jindal-promoted JSW Group and SAIC Motor have joined forces to establish a compelling joint venture (JV); the strategic collaboration is poised to elevate the operations of MG Motor, owned by the Chinese giant SAIC, in India. With JSW securing a substantial 35% stake in the JV, the partnership aims to propel MG Motor into a new era of growth, with a distinct focus on pioneering green mobility solutions in response to the evolving landscape of the Indian automotive industry.
JSW Group, led by Sajjan Jindal, and SAIC Motor have officially entered into a joint venture (JV) to enhance the operations of MG Motor in India; in this collaboration, JSW will hold a significant 35% stake in the venture.
The announcement, made in London, signifies a strategic move to expand MG Motor’s presence in India, focusing on sustainable and eco-friendly mobility solutions.
Parth Jindal of the JSW Group expressed their commitment to transforming MG Motor’s operations, especially in the realm of green mobility solutions. This partnership is expected to facilitate the growth of MG Motor in India, with JSW actively participating alongside SAIC in the management of the automobile unit.
The collaboration aims to enable MG Motor, recognized for its Hector and Astor SUVs, to not only broaden its local operations but also venture into the rapidly growing electric vehicle segment in India.
SAIC is set to contribute advanced technology and products to support the joint venture; key agreements, including the shareholder agreement and share purchase and subscription agreement, were formally signed by SAIC President Wang Xiaoqiu and JSW Group’s Parth Jindal. The deal, initially reported on June 15, outlines JSW Group’s ownership of 35-38% in the joint venture.
In pursuing “green mobility solutions,” JSW emphasizes its aspiration to introduce innovative and environmentally conscious automobile products and services. Thus, the joint venture aims to capitalize on synergies by combining resources in automobiles and new technology, with a specific focus on electric vehicles.
Both partners stressed that they are dedicated to fostering innovation, creating a sustainable electric vehicle ecosystem, and achieving a leadership position in this evolving space. The joint venture’s initiatives include promoting local sourcing, enhancing charging infrastructure, expanding production capacity, and introducing a diversified range of vehicles with an emphasis on green mobility.
MG Motor India had previously expressed its intention to dilute a majority stake in the company to Indian entities for funding expansion plans over the next five years. This growth strategy involves a substantial investment of Rs 5,000 crore, including the establishment of a second manufacturing facility in Gujarat, aiming to double the company’s installed capacity to 300,000 units.
The MG brand, originating from the UK, is owned by SAIC; despite initial success with the launch of the Hector SUV in 2019, MG Motor’s expansion plans faced challenges due to government restrictions on Chinese investments amid border tensions.
Hence, the joint venture with JSW Group marks a strategic move to overcome these challenges and further establish MG Motor’s presence in the Indian market.
Collaboration Amid Calm Waters – Further Details
In late November of this year, the JSW Group, spearheaded by Sajjan Jindal, had finalized an agreement with China’s SAIC Motor to acquire a substantial 35% stake in the Indian subsidiary, MG Motor India.
The agreement dictated that JSW Group would acquire the specified stake in SAIC’s Indian subsidiary, MG Motor India, for an undisclosed sum. Despite heightened geopolitical tensions leading to increased scrutiny of Chinese investments by the Indian government, this acquisition positions the maker of Hector and Astor to expand its local market operations.
Simultaneously, it provides JSW Group with an entry point into the rapidly evolving electric vehicle segment in India.
The shareholder agreement and the share purchase and subscription agreement were formalized in a signing ceremony at MG Motor’s office in London, involving SAIC President Wang Xiaoqiu and JSW Group’s Parth Jindal.
Wang Xiaoqiu, President of SAIC Motor, expressed the collaborative vision, stating, “In the growing Indian automotive market, both partners shall work closely to bring in the best of innovation, in creating greener and smarter mobility products and services for our consumers.”
Parth Jindal echoed this sentiment, emphasizing the strategic collaboration’s goal to transform MG Motor’s operations in India, particularly focusing on green mobility solutions.
The joint venture between SAIC Motor and JSW Group is poised to concentrate on developing the electric vehicle ecosystem and attaining a leadership position in this dynamic space through synthesising resources in automobiles and new technology; the partners aim to create strategic synergies.
The joint venture additionally plans to embark on several initiatives, including bolstering local sourcing, enhancing charging infrastructure, expanding production capacity, and introducing an extended range of vehicles with an emphasis on green mobility.
MG Motor India is actively pursuing the diversification of its product portfolio, targeting a doubling of offerings by 2028. The company plans to introduce 4-5 new cars, predominantly electric vehicle models, aiming for 65-75% of its sales to come from the EV portfolio by 2028.
In the short term, MG Motor India aims to achieve profitable growth, targeting sales between 80,000-100,000 units this calendar year, with about a third of these volumes attributed to electric vehicles such as ZS EV and Comet EV.
