India’s indigenous motor company TVS on Wednesday announced its partnership with global automobile giant BMW to develop Electronic Vehicles (EV) in the country. Reportedly, to make a mark in the ‘clean mobility offering’ segment with players like Ather, Ola, Mahindra & Mahindra already congesting the field — the collaboration will roll out its first product in the next two years. Meanwhile, China has been caught nursing its wounds as another big player goes India’s way.
Under the partnership, Chennai headquartered TVS will be responsible for designing and developing future BMW Motorrad products as well as looking after supply chain management, and industrialisation.
Sudarshan Venu, Joint Managing Director, TVS Motor Company was quoted as saying by HT Auto, “The new world of future mobility encompasses a strong play through alternate solutions, including electric mobility. Expanding this successful partnership to EVs and other newer platforms will create opportunities to deliver advanced technology and aspirational products to global markets,”
Modi government’s Rs 76,000 crore approval for manufacturing semiconductors
The development comes on the heels of the Modi government’s decision of approving a Rs 76,000-cr incentive scheme for semiconductors. The move would further India’s ambitions to be self-reliant in electronics manufacturing, bring massive investments and result in 35,000 specialised jobs apart from indirect employment for one lakh people.
As is well understood, modern cars and bikes require the use of semiconductors on a large scale. However, the disruption in supply chain management due to Covid-19 has slowed down the process of procuring precious modern commodities.
China is struggling
China is going through a severe semiconductor as well as electricity shortage and thus, the Modi government has seized the opportunity to take the market away from it. EV is the future and India has made rapid strides in the sector.
TFI had recently reported how Apple and Tesla have directly been impacted by China’s electricity woes, and the same promises to be the end of their Chinese adventure. Several Apple and Tesla suppliers have suspended production at some Chinese factories for a number of days to comply with tighter energy consumption policies.
Now, multinational companies are being forced to rethink their operations in China. Apple, in any case, has been looking to diversify its production options and has been turning to India after steadily abandoning China.
Read More: Apple and Tesla turn to India as China struggles under an intense energy crisis
Launching PLI schemes for the EV sector
Moreover, as reported by TFI, in September, the government launched another iteration of the Production Linked Incentive (PLI) scheme worth Rs 26,000 crore for the auto sector. The scheme will boost the production of electric vehicles and hydrogen fuel vehicles in the country.
This is the second PLI scheme in the sector as the government had earlier launched the scheme for Advanced Chemistry Cell (Rs 18,100 crore) and Faster Adaption of Manufacturing of Electric Vehicles (Rs 10,000 crore).
The inclusion of a PLI scheme of this magnitude, combined with existing schemes like FAME, multiple state subsidies, and the ACC scheme provides a direct financial incentive for the brands and an indirect one in the form of investments that such a scheme is likely to invite. According to the government, it expects the PLI scheme to bring in investments of Rs 42,500 crore.
India’s story with EV has only just begun. With the government actively backing the companies and creating a self-sustaining manufacturing setup, collaborations like TVS-BMW can go a long way in the future.
