Volkswagen And Mercedes-Benz Eye Local EV Manufacturing In India Under New Policy

8/21/2024 5:37:11 AM

(MENAFN- KNN India) New Delhi, Aug 21 (KNN) Volkswagen and Mercedes-Benz, two prominent German automakers, have expressed interest in local electric vehicle (EV) manufacturing in India, according to a senior government official.

This move appears to be in response to the country's new EV policy, which offers reduced import tariffs for companies committing to significant local investment and production, reported Moneycontrol.

The policy, announced on March 15, provides import duty concessions to firms that invest a minimum of USD 500 million and establish manufacturing facilities within three years, with at least 25 per cent local component sourcing.

Qualifying companies can import up to 8,000 EVs annually at a reduced 15 per cent duty for vehicles priced at USD 35,000 and above, a significant reduction from the standard 70-100 per cent import tax.

While both Volkswagen and Mercedes-Benz have substantial operations in India, neither has officially confirmed their plans regarding the new policy.

A Škoda Auto Volkswagen India Private Limited representative stated they had no comment at this time, while a Mercedes-Benz India spokesperson declined to address what they termed 'speculations.'

Mercedes-Benz has already invested over Rs 3,000 crore in Pune, where it operates an EV assembly line. Volkswagen is reportedly considering assembling its ID.4 electric car at its Aurangabad plant for a potential 2024 launch.

The Indian government is expected to release draft guidelines for the revised EV policy soon.

These guidelines will likely include details about a Project Management Agency (PMA) to provide managerial and implementation support, as well as information about a dedicated portal.

This development comes as India seeks to boost its domestic EV manufacturing capabilities and reduce reliance on imported vehicles.

The government's initiative aims to attract foreign investment and technology transfer in the rapidly growing electric vehicle sector.

(KNN Bureau)

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