Picture this: The year, 1980. The place, India. Television broadcasts are in black & white. Telephones occupy pride of place in many homes. Bollywood blockbuster Qurbani has introduced disco music to the masses with its hit song “Aap Jaisa Koi”. And during office hours, roads in most cities see a steady rush of Bajaj scooters; and Ambassador and Fiat cars that are manufactured by Kolkata-based Hindustan Motors and Mumbai-based Premier Automobiles, respectively.
While Maruti Udyog had been set up in the early 1970s with an aim to build a passenger car company that caters to the country’s growing middle class, it is far from taking off.
Let us fast forward a few years. Executives from Suzuki Motor Corporation fly down from Japan with their technical know-how and investments—leading to the formation of Maruti Suzuki. The rest is history.
The Maruti Suzuki story has inspired a generation of entrepreneurs, including Sajjan Jindal, Chairman of diversified conglomerate JSW Group, who was beginning his journey then. “Making cars has been my childhood passion,” Jindal, 64, shared at an event more than 40 years later, adding that he built his first car in his garage when he was around 12. “And the passion of making cars has stayed with me.” Today, he is a happy man. After waiting for nearly four decades, he has achieved his dream of manufacturing passenger cars. In 2024, JSW Group picked up a 35% stake in MG Motor India. And like the Maruti story, with JSW MG Motor India—a joint venture with China’s leading carmaker, the state-owned SAIC Motor—Jindal plans to script history by transforming the local passenger car landscape, which is at the cusp of a green revolution, he revealed at the event to announce the JV.
While he had harboured his dream for years, Jindal started things in earnest in 2015-16 when new energy vehicles (NEV) began gaining traction in India. In 2017 he started assembling a team to build EVs, but the Covid-19 pandemic brought his plans to a standstill. However, his dream was meant to be. As he put it (quoting a famous dialogue in Hindi from Shah Rukh Khan’s hit Bollywood movie Om Shanti Om), “When you wish for something with all your heart, the entire universe comes together to fulfil your wish.” With the pandemic completing its cycle and business activity back to normal, Jindal finally has his venture rolling. “We will create a Maruti moment like it happened in the early 1980s, when it entered the India market,” he said at the event in March.
The History
The plan is simple. The management aims to rapidly grow the entity into an NEV company by adopting the latest technologies and increasing localisation. The plan is to ultimately position it as a leading EV maker in the world’s third-largest passenger car market.
Interestingly, Jindal said, things were working in tandem. For instance, in 2017, when he was preparing to take the EV leap, MG (originally a British brand) entered India with its promise of setting up a manufacturing base in the country. MG tasted early success with its first model, the Hector. And by 2019, it had completed the takeover of the erstwhile General Motors plant in Gujarat’s Halol and started production in India.
Then came the pandemic in 2020. While Covid-19 hit JSW’s plans, the clash between Chinese and Indian soldiers in the Galwan Valley added to MG’s pain. As relations between New Delhi and Beijing soured, it put Chinese investments in India under greater government scrutiny. MG Motor India, like many other Chinese majors, received notices from the Ministry of Corporate Affairs for alleged irregularities in financial reporting for FY21. Plus, approvals on new investments by Chinese firms dried up. “In the passenger vehicles industry, hardly any approvals have been given in recent times to Chinese investments. Apart from the authorities, even the local auto industry lobby is against a free run for Chinese automakers. Thus, it was prudent for MG to look for Indian partners,” says a senior auto industry executive who declined to be named.
According to Manish Raj Singhania, President of the Federation of Automobile Dealers Associations (FADA), while the move to bring Indian partners on board may have been forced, MG was already well-positioned in the passenger vehicles (PV) space.
Introducing MG 3.0
Rajeev Chaba, CEO Emeritus of JSW MG Motor India, is upbeat. After SAIC divested 51% stake, JSW owns 35% in JSW MG Motor India, some 8% stake is with Indian financial institutions, 3% is held by the company’s dealers, and employees own 5%. Apart from ‘Indianising’ the company, JSW—India’s largest steelmaker—also has a slew of businesses that may prove handy in improving local value addition for MG. The stakeholders are investing more than Rs 5,000 crore to fulfil MG’s near-term needs. More such investments are on the cards as it progresses towards manufacturing key components like EV cells and localising the tech. “The aim is to make available the best technologies to the Indian consumers, [and] eventually manufacture and design them in India. And offer them to the customers at the best price possible,” Jindal had said.
The road map for growth is clear. First, MG needs to expand its manufacturing capacity at the Halol plant to 120,000 units a year from the current 70,000, which Chaba claims has already been achieved. Second, it needs to quadruple annual sales by 2028 to close to 300,000 units from the current level of 70,000 units. Third, as demand for cars grows, MG plans to set up a second plant at Halol, with annual production capacity of 180,000 units to take local manufacturing capacity to 300,000 units. Fourth, increase localisation and help grow the EV market in India. And fifth, leverage its early mover advantage to position MG at the top of the pecking order in a larger future EV market in India.
Chaba says MG needs to keep expanding its footprint. “It also means that we introduce new models as we expand capacity. All that will follow. But the bigger picture of this JV is to have a long-term win-win relationship between the two shareholders. And we can be the leaders in green and sustainable solutions in India”.
If MG’s first leg of the India journey (2017-2023) was MG 1.0, Chaba prefers to call the upcoming leg of the journey (2026-2028) MG 3.0, by when the plan is expected to be fully executed. The blueprint also involves manufacturing cells and EV components in India, either in-house or through third parties. He says Sajjan Jindal brings keen focus on localising the EV ecosystem. “The entire focus currently is on NEVs, with EVs at the forefront. By 2027-28 nearly 85% of our sales is likely to be NEVs, which may go up to 100% by 2030,” he says. Currently, EVs form 30-35% of MG’s overall sales in India.
MG is adopting a dual-channel distribution strategy that proved to be a major success for PV market leader Maruti Suzuki. Apart from MG’s mainstream channel, Chaba is planning to line up “accessible luxury cars” under a new MG Select channel. Together, these channels will have two new car launches every year. Further, to make EVs affordable, MG’s game plan involves offering vehicles through its BaaS (Battery as a Service) programme, which allows customers to purchase the recently launched Windsor at a lower upfront initial cost (excluding battery cost) and pay for the battery on a pay-per-use model.
Full Throttle
After years of waiting, the Jindals want to grow aggressively. Parth Jindal, Sajjan Jindal’s son and a member of the Steering Committee of JSW MG Motor India, is betting on the rapid rise in NEV sales over the next 10 years. The EV space in India is set to grow fast and he wants to have 33% market share by 2030. According to NITI Aayog, India’s EV market will have a CAGR of 49% till 2030. The government expects the share of EVs to grow to 30% by the end of the decade from the current levels of 2-3%.
Over the next decade, Parth Jindal estimates, the size of the passenger cars market in India is expected to grow to 10 million units a year from some 4 million now. “By leveraging the legacy of a world-renowned British brand, cutting-edge MG technology and JSW’s local manufacturing knowledge and acumen, I have no doubt that JSW MG will make world-leading products in India for India and the world,” he had said at the launch, adding that the goal was to become India’s leading auto OEM in the NEV segment. MG plans to introduce at least two new EV models every year, apart from expanding its portfolio of internal combustion engine (ICE)-powered cars.
But MG faces stiff competition. Tata Motors dominates the PV segment of the EV market in India. However, sales of EVs saw a decline in Q2FY25 , including at Tata Motors, because of regulatory obstacles and lack of subsidies. “EV sales in the personal segment were affected by the lapse of registration and road tax waivers in key states. Fleet EV sales continued to remain impacted due to lapse of FAME II and non-inclusion of the fleet segment in the PM E-DRIVE Scheme,” said Shailesh Chandra, Managing Director, Tata Motors Passenger Vehicles Ltd and Tata Passenger Electric Mobility Ltd, in a statement. Despite slowing growth, MG expects the share of EV passenger cars should be well over 15% by 2030.
MG’s push to localise production of EV cells and key tech is not without rationale. With cells being the costliest part of an EV, localising its production and an in-house supply chain could prove to be a deciding factor. “Currently, a lot of components like cells and tech are imported from China, the world leader in EV technologies. So, it is important for the development of the EV market in India that we quickly learn the tech and create an EV ecosystem here,” says FADA’s Singhania.
And that is where MG’s partnership with the JSW Group becomes important. JSW has already announced plans to manufacture EV batteries. “We can buy cells locally from them,” says Chaba. This inter-group synergy in production and supply will help MG cut costs, say experts.
Further, JSW has already applied under the PLI scheme to produce specialty steel that is costlier than regular steel.
“There is a lot of value in terms of synergies with JSW’s businesses, especially steel and energy production,” says Chaba, as both are crucial for the EV market’s growth and MG’s future in India.
“This is how we will push the localisation bid. Second, we are also working to bring more vendors near our plant and build an ecosystem, which will help us reduce the time to develop new components and start local production, while ensuring just-in-time inventory,” he explains.
To localise tech used in connected cars, his team is also in talks with leading Indian companies. MG is also working on possible localisation of electric drive unit (EDU) production with a handful of players. An EDU is a module that integrates the motor-generator and power electronics in a single system, which helps in achieving synergy in EVs. Much like the synergy MG and JSW Group need to be able to pull off this PV revolution.
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