Mahindra Last Mile Mobility planning to double capacity, scouting for new factory site

New Delhi: Mahindra Last Mile Mobility, which makes three- and four-wheeler small commercial vehicles, is considering doubling production capacity in the next two years on the back of strong demand for electric three-wheelers.

The company, a subsidiary of Mahindra & Mahindra, currently has capacity to make 300,000 units per annum at its facilities in Telangana, Karnataka and Uttarakhand.

Managing director and chief executive Suman Mishra said the company started scouting for a new site to build additional capacity. She did not provide details of investments or incremental capacity being considered at the proposed facility.


“The rate at which the market is growing, we will need more capacity. We are actively looking for expansion; it can be both through a brownfield or a greenfield facility,” she told ET.

Mishra expects the company to fully utilise the capacity at its existing facilities in the next 18-24 months, by which time the new facility will need to come onstream. The capacity requirement is not limited to vehicle assembly. Battery-pack and supplier capacity will also have to be scaled up as the company’s electric three-wheeler sales rise.

“In the passenger-carrying three-wheeler segment, penetration of electric is already at 40%. This will increase to 75-80% by 2030. We want to have a share of at least 40% in this market,” Mishra said. “In addition to this, we need capacity for making electric cargo three-wheelers and small four-wheelers. The domestic demand is huge. We are also looking to expand exports as we scale.”

The company plans to utilise the Rs 322 crore it raised in its latest funding round to bring additional products and set in motion plans for its capacity expansion.

Plans are also on cards for an initial public offering by the end of next year, subject to market conditions, which would bring in additional resources for expansion.

The company is already working towards reducing import content in its range of electric three-wheelers and de-risking supply chain from China, Mishra said. “Already, apart from cells, we are more or less making everything here. As and when local manufacturing of cells starts in India, we will initiate trials with suppliers here,” she added.