Tamil Nadu, often called the Detroit of India due to its thriving automobile manufacturing ecosystem, is also not willing to miss out on the electric vehicle bandwagon. Recent developments bear witness to this.
Vietnamese electric vehicle maker VinFast has promised to build a $2 billion plant in the southern state. And as promised, work on the Tata Motors-JLR plant will begin next week on September 28 following a groundbreaking ceremony. Ford Motor has also announced its return to the state with plans to manufacture electric vehicles.
Favorable industrial policies launched in 2014, skilled labor and a good supply chain network paved the way for EV manufacturers to land.
Currently, about 40 per cent of the country’s EV production, including two-wheelers, three-wheelers and cars, takes place in Tamil Nadu. In the two-wheeler segment, three of the top five EV manufacturers — Ola Electric, TVS Motor and Ather Energy — are already based in the state.
The state already accounts for 70 per cent of total electric two-wheeler manufacturing in India, with a current production capacity of 10 million units.
Meanwhile, another major passenger vehicle maker, Hyundai, has already prepared a Rs 20,000 crore roadmap for its Chennai unit.
In 2024, investments in EVs have already been committed by Tata Motors-JLR (Rs 9,000 crore), VinFast (up to $2 billion) and Royal Enfield (Rs 3,000 crore), in addition to expansion plans by Hyundai and Stellantis (Rs 2,000 crore).
In April, Citroën became the first Indian multinational carmaker to export locally-made electric vehicles to the international market by exporting the Tamil Nadu-made Ë-C3.
The thriving ecosystem
According to industry experts, the presence of more than 1,500 factories producing cars and car components is what gives the state the biggest advantage over others. This established ecosystem allows new players to easily enter the market.
“Tata Motors-JLR and VinFast are export-focused, which makes them very important for the state. However, there is also a need to build a stronger sub-system ecosystem. The state has a first-mover advantage with the existing infrastructure in the Hosur region,” said Thiru Srinivasan, Senior Advisor – EV Sector, FameTN.
Tamil Nadu Chief Minister MK Stalin will lay the foundation stone for the Tata Motors-JLR plant at Panapakkam in Ranipet district on September 28. It will be the first time that a premium vehicle will be entirely manufactured in India instead of being assembled.
The unit is expected to be operational in 12-18 months. Tata Motors plans to produce “Made in India” models based on JLR’s modular electrified architecture (EMA) for export, along with Tata electric vehicles based on the same architecture.
Tata Motors is expected to leverage on the existing ecosystem of Hyundai Motor India (HMIL) and Renault Nissan Automotive India, besides bringing in its own suppliers.
Tamil Nadu Electric Vehicle Centres
The state government has identified six cities – Coimbatore, Trichy, Tirunelveli, Madurai, Salem and Chennai – for development as EV hubs. Some of the natural advantages favouring this sector are the availability of a skilled workforce, a network and supply chain of ancillary suppliers, a vibrant auto and auto component manufacturing ecosystem, and supporting logistics systems and infrastructure.
According to Guidance Tamil Nadu, the state contributes 36 percent of the total two-wheeler production, 25 percent of four-wheeler production and 40 percent of tyre production in India.
First published: September 17, 2024 | 16:49 IS
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