JSW Group, one of the country’s top business houses with a strong presence in steel, energy, infrastructure, cement, and paints, has ventured into the passenger vehicle segment. The company has partnered with China’s MG Motor, which already has a presence in India, and the duo plan to sell one million electric passenger vehicles by 2030 and have a market share of 33%. Sounding euphoric and ambitious, JSW Group chairman Sajjan Jindal, while announcing the plans for the auto venture, said that JSW MG Motor will create a “Maruti moment” in the EV space. As is well known, in 1983, Maruti changed the face of the domestic auto industry by bringing lightweight and efficient cars, which sent incumbents—Ambassador and Fiat—into oblivion. Today, Maruti has a market share of around 50% in the passenger vehicle segment. Jindal’s plan is to build scale by launching an EV every 3-4 months beginning September. It wants to disrupt the market in the EV space, which is a nascent segment at present, and create the Maruti moment of the 1980s.
Also Read
JSW Energy arm signs pact with Reliance Power to acquire 45 MW wind project for Rs 132 crore
There is nothing wrong in being ambitious and Jindal has an impeccable track record. However, is there really a room to create a “Maruti moment” in this day and age? Way back in 1981, when Maruti was born, the annual sales of cars in India was stagnating at less than 40,000 units, with the presence of only two manufacturers. In 2023, Maruti manufactured two million cars and exported over a quarter million. On an overall basis, car sales in FY24 are set to cross the four million-mark, and India today ranks as the world’s third largest passenger vehicle market, with all the global players having a presence here.
The share of EVs may still be small, at around 2% of the total PV sales, so technically a 1983-kind of comparison with Maruti can be made. However, the low-share of EVs is not because of a dearth of models—there are around eight models available in the market today, and four launches are in the pipeline. Tata Motors is the largest player with a 73% market share, while M&M has a share of around 5%. The price of the available vehicles range between `8 lakh to around `26 lakh. Market leader Maruti may not be present in the EV segment today but plans to enter in 2025. The second largest manufacturer, Hyundai Motor, has made a beginning and has chalked out ambitious growth plans.
Also Read Powering India’s future: Ramping up country’s renewable energy capacity Across the aisle by P Chidambaram: The soup kitchen Inside track by Coomi Kapoor: Bond of secrecy Building codes and Indian cities The market, if not crowded, is well-served, unlike 1983, and it’s a buyer’s market, not a seller’s which was the case in the 80s. Market disruption happens either in terms of price or product, and on both these counts, the ride is not going to be easy for Jindal. The incumbents are vibrant and compete strongly on both the fronts, plus they have an added advantage of an extensive sales and distribution network. Marquee global brands like General Motors and Ford failed in India because they could not match the scale of incumbents in this regard. In the EV space, the big challenge is to create the infrastructure for charging networks. If “Maruti moment” means exhibiting a successful partnership between a local and a global player, certainly, Jindal has a clear field. But if it means disrupting the market, it’s going to be a long, tough ride.
JSW Group, one of the country’s top business houses with a strong presence in steel, energy, infrastructure, cement, and paints, has ventured into the passenger vehicle segment. The company has partnered with China’s MG Motor, which already has a presence in India, and the duo plan to sell one million electric passenger vehicles by 2030 and have a market share of 33%. Sounding euphoric and ambitious, JSW Group chairman Sajjan Jindal, while announcing the plans for the auto venture, said that JSW MG Motor will create a “Maruti moment” in the EV space. As is well known, in 1983, Maruti changed the face of the domestic auto industry by bringing lightweight and efficient cars, which sent incumbents—Ambassador and Fiat—into oblivion. Today, Maruti has a market share of around 50% in the passenger vehicle segment. Jindal’s plan is to build scale by launching an EV every 3-4 months beginning September. It wants to disrupt the market in the EV space, which is a nascent segment at present, and create the Maruti moment of the 1980s.
There is nothing wrong in being ambitious and Jindal has an impeccable track record. However, is there really a room to create a “Maruti moment” in this day and age? Way back in 1981, when Maruti was born, the annual sales of cars in India was stagnating at less than 40,000 units, with the presence of only two manufacturers. In 2023, Maruti manufactured two million cars and exported over a quarter million. On an overall basis, car sales in FY24 are set to cross the four million-mark, and India today ranks as the world’s third largest passenger vehicle market, with all the global players having a presence here.
The share of EVs may still be small, at around 2% of the total PV sales, so technically a 1983-kind of comparison with Maruti can be made. However, the low-share of EVs is not because of a dearth of models—there are around eight models available in the market today, and four launches are in the pipeline. Tata Motors is the largest player with a 73% market share, while M&M has a share of around 5%. The price of the available vehicles range between `8 lakh to around `26 lakh. Market leader Maruti may not be present in the EV segment today but plans to enter in 2025. The second largest manufacturer, Hyundai Motor, has made a beginning and has chalked out ambitious growth plans.
The market, if not crowded, is well-served, unlike 1983, and it’s a buyer’s market, not a seller’s which was the case in the 80s. Market disruption happens either in terms of price or product, and on both these counts, the ride is not going to be easy for Jindal. The incumbents are vibrant and compete strongly on both the fronts, plus they have an added advantage of an extensive sales and distribution network. Marquee global brands like General Motors and Ford failed in India because they could not match the scale of incumbents in this regard. In the EV space, the big challenge is to create the infrastructure for charging networks. If “Maruti moment” means exhibiting a successful partnership between a local and a global player, certainly, Jindal has a clear field. But if it means disrupting the market, it’s going to be a long, tough ride.
Get live Share Market updates, Stock Market Quotes, and the latest India News and business news on Financial Express. Download the Financial Express App for the latest finance news.
login
who are we?
contact us
qosheapp
Toi Staff
Gideon Levy
Belen Fernandez
Mort Laitner
Rami G Khouri
Ali Fathollah-Nejad
Nikkei Editorial
visit website
