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India's Mahindra to enter UK with sub-£10k EV in 2016

Date: 29 July 2015   |   Author: Daniel Puddicombe

Indian car manufacturer Mahindra is planning to enter the UK car market during the first quarter of 2016 with an electric vehicle costing less than £10,000, BusinessCar can reveal. 

Known as the E2O, the model has been on sale in India for two years.

The company is known in India for its rugged SUVs and pick-ups, while it also owns Ssangyong and Reva, which produced the G-Wiz.

"Our UK market plans are only with electric vehicles," Dr Pawan Goenka, group president of Mahindra's automotive sector, told BusinessCar. "We have been speaking to the UK Government for quite some time and they are keen for the car to come to the UK.

"The reason why they are keen is because they'd like to have sub-£10,000 electric vehicles on sale in the UK and we believe we can do that with the current Government subsidy."

In India, the Government's subsidy equates to around £1200 off the purchase price of electric vehicles, which Goenka said is nothing like what the UK offers.

"The desire of the British Government to make electric vehicles mainstream is very serious. We have had a lot of interaction, all the way up to the prime minister.  Half a billion pounds to incentivise the uptake of electric vehicles is very serious," he added.

While he couldn't give any specific details, Goenka said the car would have a "sensible" range. In India, the E2O has a maximum range of 120km (62 miles) between charges.

Goenka was quick to distance the vehicle from merely being a rebadged second-generation G-Wiz: "The G-Wiz was a quadricycle, whereas the E20 is a fully fledged vehicle, which meets all the requirements a modern vehicle has to meet," he said.

"It [the E2O] is a car that has space like any other hatchback and is a comfortable four-seater, with good range and speed. Therefore, it is not a second-generation G-Wiz - it's a new car."

It will be marketed as a second car for families, which Goenka said will work because the purchase price is low: "It is almost perfect as a second car, because you have one car for going up the country, and a second car for going around town."

Goenka claimed his product received "very good feedback" when the firm conducted market research in the UK. "That encouraged us a lot and we think it should be here by the first quarter of next year," he said.

No plans for Mahindra to enter UK commercial vehicle market

Goenka said the firm has no plans to bring what he called conventional vehicles to the UK any time soon.
"The UK is the only Euro 6 right-hand drive market in the world, which makes it a difficult market to enter," he told BusinessCar. "If we were to bring a vehicle to the UK just for the UK we would have to develop right-hand drive Euro 6 cars."
"Unless we know we can sell a sizeable number - eight to 10 thousand vehicles a year - we cannot justify spending the money for Euro 6 right hand drive vehicles," Goenka added.
"It's a question of financial justification of  'can we afford to develop vehicles for the UK market and can we get enough volume to make it happen?' Hopefully in the future that will happen, but at the moment we have no plans."
Mahindra owns Ssangyong, and Goenka said he wants the Korean brand to "lead the way" among Mahindra's companies in the UK market.
However, the company's sales are well off Goenka's justifiable target at the moment - Ssangyong registered just 197 commercial vehicles and 1542 passenger cars in 2014.
"Our objective is to launch a new Ssangyong product every year in the UK. We are currently working on three new platforms that are on the drawing board in various stages," Goenka revealed to BusinessCar.
Ssangyong launched a 1-tonne Korando Sports pick-up earlier this year, which is significant for the company as it means buyers don't have to pay VAT on top of the purchase price, as the model is classed as a commercial vehicle.