Business Standard: February 16, 2015
Chennai: Mahindra & Mahindra on Saturday said it would invest about Rs 4,000 crore in Tamil Nadu, after the state decided to allocate land for the company at Cheyyar, near Chennai.
The company will be setting up a test track in the Phase-I, followed by an automotive plant. Around 250 acres will be allocated, said Pawan Goenka, executive director and president Automotive & Farm Equipment Sectors for Mahindra & Mahindra.
“A land allocation letter will be given on Saturday and memorandum of understanding will be signed at the Global Investors Meet, which is scheduled on May 23-24.”
According to him, the company has committed Rs 2,000 crore now.
The company will immediately start the work the test track. Later, it will work on automotive plant as part of phase-II expansion, that would be taken up after company completes investment in Chakan plant, Maharashtra.
Goenka said the company has seven years, from the time it signs MoU to start operation.
“As we develop new products, those will be manufactured in the new plant for both domestic and export markets. Since the company has a tractor manufacturing facility in Andhra Pradesh, tractors may not be manufactured here,” said Goenka.
“Some signs of revival is there in the automotive sector. Overall the struggle in the industry continues, but we hope some improvement post Budget,” he added.
Anand Mahindra, vice-chairman and managing director, Mahindra & Mahindra, met then Tamil Nadu Chief Minister J Jayalalithaa in June 2012 to explore opportunities for setting up a manufacturing plant in the state. But the land was not allocated to the company immediately for various reasons.
When Mahindra Ford was planning to set up a greenfield facility, the Tamil Nadu government pitched in with a super mega project policy, which resulted Ford to set up its facility at Maramalai Nagar, near Chennai. Similarly, when Mahindra and Renault wanted to set up a facility in 2006 again, the Tamil Nadu government managed to grab the investment, after it brought out the ultra mega project scheme.
“Mahindra & Mahidra invested around Rs 5,000 crore in Tamil Nadu and about 36,000 jobs were created, including setting up a Mahindra World City, an integrated business city, which houses industrial units like BMW, Sundaram Fasteners, Brakes India and others. The City also houses Mahindra Research Valley (MRV), the research arm of Mahindra & Mahindra,” said Goenka.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.