M&M

June 2 (Reuters) -

• INDIAN GOVERNMENT FINALISES NEW ELECTRIC VEHICLE POLICY - STATEMENT

• INDIA GOVERNMENT: INVESTMENT TOWARDS BUILDING, MACHINERY, RESEARCH, CHARGING NETWORK WILL BE CONSIDERED TO A LIMITED EXTENT

• INDIA GOVERNMENT: UNDER NEW SCHEME COMPANIES ALLOWED TO IMPORT EVS PRICED AT $35,000 AT REDUCED TARIFF OF 15% FOR 5 YEARS

• INDIA GOVERNMENT: IMPORT OF EVS AT LOWER DUTY PERMITTED ONLY IF COMPANIES INVEST $486 MILLION IN MANUFACTURING ELECTRIC CARS IN INDIA

• INDIA GOVERNMENT: UNDER NEW SCHEME COMPANIES WILL BE ALLOWED TO IMPORT A MAXIMUM OF 8,000 EVS EACH YEAR

• INDIA GOVERNMENT: COMPANIES MUST BEGIN EV PRODUCTION IN 3 YEARS AFTER GETTING APPROVAL

• INDIA GOVERNMENT: COMPANIES NEED TO ACHIEVE 25% LOCAL CONTENT IN CARS IN 3 YEARS, 50% IN 5 YEARS IN MAKING EVS

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May 5 (Reuters) - Mahindra and Mahindra Ltd MAHM.NS:

• MAHINDRA & MAHINDRA - PLANNING NEW GREENFIELD PLANT FOR SUVS FOR FY28 AND BEYOND

Further company coverage: MAHM.NS

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May 1 (Reuters) - Three of India's top four carmakers reported weak sales to dealers in April, company data showed on Thursday, as buyers delayed purchases amid concerns about slowing economic growth.

Market leader Maruti Suzuki MRTI.NS posted a marginal 0.6% year-on-year rise, while Hyundai Motor India HYUN.NS and Tata Motors TAMO.NS clocked declines of 11.6% and 5.1%, respectively.

Mahindra & Mahindra MAHM.NS, in contrast, reported a near 28% jump in monthly sales, aided by strong demand for its 'XUV 3X0' and five-door 'Thar' SUVs.

That helped the 'Scorpio' maker overtake Hyundai and Tata Motors to the no. 2 spot in India's car market for the second time this year.

The four automakers together account for 80% of a market that saw record sales of 4.3 million units last year. Their combined sales were up about 1.4% in April, led largely by Mahindra.

WHY IT MATTERS

India's auto sector makes up 7% of GDP and is a major employer.

The country's economic growth is seen slowing down, with the central bank projecting full-year GDP growth of 6.5% for fiscal 2025, lower than the 9.2% recorded the year before.

KEY CONTEXT

Car sales are cooling as the post-pandemic pent-up demand, which propelled sales to record highs in past years, has faded. Growth slowed to 2% in financial year 2025, from 8% the previous year and 27% in fiscal 2023, with industry experts attributing the moderation to a broader economic slowdown.

Manufacturers expect car sales to grow 1%-2% this year, although some analysts expect growth to pick up by June or September on lower interest rates and a cut in personal income tax.

Phillip Capital said that buyers were postponing purchases, with the trend likely to continue for up to four months.

Maruti has held up better due to SUV demand and fleet sales, while Hyundai and Tata have struggled amid fewer new launches as they derive two-thirds of their sales from SUVs.

BY THE NUMBERS

(Reporting by Nandan Mandayam in Bengaluru; Editing by Sonia Cheema)

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NEW DELHI, April 26 (Reuters) - India's Mahindra & Mahindra MAHM.NS, known for its muscular SUVs and tractors, said on Saturday it had entered into a deal to buy a 58.96% stake in SML Isuzu SMLI.NS for 5.55 billion rupees ($65.00 million) to bolster its truck and bus business.

The acquisition will double Mahindra's market share in the trucks and buses segment of India's fast-growing economy to 6%, with a plan to raise that to 12% by fiscal year 2031, it said.

Mahindra will buy Japan-based Sumitomo Corp's 8053.T 43.96% stake in SML and Isuzu Motors' 7202.T 15% stake, apart from launching a mandatory open offer for an additional stake of up to 26% in the company, according to local regulations.

The purchase price is 650 rupees per share, a steep discount to SML's closing price of about 1,773.4 rupees on Friday. The stock has risen about 20% this year, partly on speculation about a deal. The open offer will be for 1,554.6 rupees per share.

"The acquisition of SML Isuzu marks a significant milestone in Mahindra Group's vision of delivering 5x growth in our emerging businesses," Mahindra Group CEO Anish Shah said in a statement.

"This acquisition is aligned with our capital allocation strategy for investing in high potential growth areas which have a strong right to win and have demonstrated operational excellence."

($1 = 85.3800 Indian rupees)

(Reporting by Sarita Singh and Krishna N. Das in New Delhi
Editing by Gareth Jones)

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April 25 (Reuters) - Mahindra Holidays and Resorts India MAHH.NS reported a more than 11% fall in fourth-quarter profit on Friday due to sluggish demand for international travel amid geopolitical tensions and cost pressures.

Mahindra Holidays' consolidated net profit fell to 730.8 million rupees ($8.6 million) in the March quarter, from 823.6 million rupees a year earlier.

Geopolitical tensions and higher costs of travelling abroad held back consumers from taking trips in Europe.

That weighed on the company, which gets about half of its total revenue from its international business, which includes properties across Finland, Sweden and Spain.

Total income at its international business unit, Holiday Club Resorts (HCR), fell to 39.7 million euros ($45 million) from 41.9 million euros a year ago.

However, surging spending on local leisure travel amid the government's stated goal of making India one of the top five global tourist destinations by 2030, partly offset the decline in international business.

While domestic hotel occupancy dipped to 84.6% from 87.3% a year ago, revenue from the segment rose 5.7% to 4.03 billion rupees in the quarter, as people splurged more.

Overall revenue from operations fell 2.6% to 7.79 billion rupees owing to a 9% fall in the company's international business.

Shares of Mahindra Holidays, which offers resorts and sightseeing packages through its "Club Mahindra" membership and generates revenue through membership fees, closed 5.4% lower ahead of the results.

($1 = 85.3890 Indian rupees)

($1 = 0.8807 euros)

(Reporting by Ananta Agarwal in Bengaluru; Editing by Pooja Desai)

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By Aditi Shah

NEW DELHI, April 24 (Reuters) - India's capital New Delhi plans to limit gasoline and diesel-powered cars a family can buy as well as ban sales of fuel-guzzling motorbikes and scooters, according to a draft policy aimed at cleaning up one of the world's most polluted cities.

The measures represent one of the most drastic steps the city has lined up to tackle pollution, which often forces local authorities to ban some construction, shut schools and disrupt flights in the city of more than 30 million people during the winter season.

Under Delhi's new electric vehicle policy, the city government will also waive some local taxes on the purchase of hybrids, putting them on par with concessions given to EVs, while imposing a new levy of 0.5 rupees ($0.0059) on every litre of petrol sales, according to the 74-page draft seen by Reuters.

The primary objective "is to unlock the next phase of EV adoption, reduce air pollution and contribute to India's energy independence and net-zero targets," the draft stated.

Every year ahead of the onset of winter in Delhi, calm winds and low temperatures trap pollutants from sources including vehicles, industries and crop residue burning in nearby fields, raising the level of harmful toxins in the air.

Delhi launched the first phase of its EV policy in 2020 which helped boost the share of electric models to 12% of all new vehicle sales, including motorbikes and cars, in 2024.

Under the second phase, the policy document says, no new sales of gasoline, diesel and gas-based two-wheelers will be allowed from April 1, 2027. It is also providing a cash incentive of up to $350 on the purchase of electric bikes and scooters.

Officials at Delhi's transport ministry and the chief minister's office did not immediately respond to an email seeking comment.

LIFELINE FOR RESIDENTS

Two-wheelers are a lifeline for millions of Delhi residents, and the move could significantly impact Delhi's lower- and middle-income groups who depend on them, and not cars, to navigate the city's often congested roads.

In 2024, nearly 450,000 new two-wheeler scooters and motorbikes were sold in Delhi. There were 8 million vehicles on Delhi's roads in 2022-23, of which 67% were two-wheelers, according to central government figures.

A ban on the sale of fossil fuel two-wheelers from 2027 will hurt manufacturers such as Bajaj Motors BAJA.NS, TVS TVSM.NS and Hero MotoCorp HROM.NS, although some of the negative impact may be offset by increased sales of their electric two-wheelers.

And in a move aimed at the more affluent population, the policy is also set to limit the number of fossil fuel cars each household can purchase to two, as it aims for a 30% EV penetration by 2030, from around 2.7% last year.

"All private car owners in Delhi will be required to purchase only electric cars if they intend to own (a) third or subsequent car registered to the same residential address," the document stated.

The policy, which is expected to cost the Delhi government 28.6 billion rupees, is subject to change based on feedback from car makers and other stakeholders. It was not immediately clear when the policy will be finalised or how it will be funded.

The city government is also planning some tax waivers for hybrid vehicles to match the concessions to those given for EVs, potentially lowering their cost by up to 15%.

The move is in line with a similar move made by neighbouring state Uttar Pradesh. They are considered a win for the likes of Toyota Motor 7203.T and Maruti Suzuki MRTI.NS, but a setback for homegrown Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS who focus on EVs.

($1 = 85.3350 Indian rupees)

(Reporting by Aditi Shah; Editing by Muralikumar Anantharaman)

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By Aditi Shah and Aditya Kalra

NEW DELHI, April 23 (Reuters) - Tesla sees India's 100% import tariffs on cars making customers anxious, and the carmaker is still assessing when to enter the "very hot" market even as those concerns linger, its chief financial officer said on Tuesday.

Tesla has long wanted to sell in the world's third-largest car market, but high tariffs, which its chief Elon Musk has said are among the steepest in the world, have been a deterrent.

Even so, Tesla has in recent weeks finalised some showroom space in India and posted more than two dozen jobs, signalling it is getting closer to a launch. Commercially available custom records show that in March, Tesla imported a Model Y car to India from Germany at a shipment value of $46,000.

"The same car which we're sending is 100% more expensive than what it is. So that creates a lot of anxiety. People feel OK, they're paying too much for the car ... That's why we've been very careful trying to figure out when is the right time (to enter India)," Vaibhav Taneja said in an earnings call.

"India is a very hot market," he added.

Tesla posted dismal first quarter earnings on Tuesday, with net profit plunging by 71%.

Tesla has been lobbying India to lower import tariffs on cars, and Prime Minister Narendra Modi's officials are in talks with U.S. President Donald Trump's administration to lower the 100% levies under a bilateral trade deal.

The United States has asked for elimination of tariffs on cars, but New Delhi is unlikely to bring down taxes to zero immediately even as it considers further cuts.

Any duty cuts that make imported cars cheaper have seen strong opposition from local carmakers such as Tata Motors TAMO.NS and Mahindra and Mahindra MAHM.NS.

Musk said this week he is planning to visit India this year, after Modi and the billionaire had a conversation about collaboration in technology and innovation.

Last year, Tesla came close, with Musk planning to visit India where he was expected to announce an investment of $2 billion-$3 billion, including in a factory to manufacture EVs. But he cancelled the trip at the last moment.

(Reporting by Aditi Shah. Editing by Gerry Doyle)

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BENGALURU, April 22 Reuters - Diary of India economic, corporate events on April 22

ECONOMIC, CORPORATE .BSE500 EVENTS:

(Compiled by Bengaluru Newsroom)

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April 21 (Reuters) - Mahindra and Mahindra Ltd MAHM.NS:

• HEMANT SIKKA APPOINTED MD & CEO OF MAHINDRA LOGISTICS

Source text: ID:nBSE7MT0db

Further company coverage: MAHM.NS

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April 15 (Reuters) - Airtificial Intelligence Structures SA AI.MC:

• SIGNS SEVEN AUTOMOTIVE PROJECTS IN Q1 FOR MANUFACTURERS SUCH AS RENAULT, NISSAN, TATA, MAHINDRA, AND CHERY AUTOMOBILE

• MOVES AHEAD WITH SEVEN PROJECTS FOR RENAULT, NISSAN AND TATA IN INDIA AND CHINA

Source text: ID:nCNM4HjkqS

Further company coverage: AI.MC

(Gdansk Newsroom)

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Adds details of order, background , share move

April 9 (Reuters) - Mahindra Aerostructures, a unit of Indian automaker Mahindra and Mahindra MAHM.NS, has won an order from Airbus Helicopters to manufacture and assemble the main fuselage of its H130 light single-engine helicopter, the company said on Wednesday.

Airbus Helicopters is a unit of French planemaker Airbus AIR.PA.

Under the agreement, Mahindra Aerostructures will produce the H130’s main fuselage assembly, which will then be shipped to Airbus Helicopters’ facilities in Europe.

The H130 is an intermediate single-engine helicopter used for transporting passengers.

Mahindra Aerostructures, which also counts Boeing BA.N and Dassault Aviation AM.PA among its customers, did not disclose financial details of the deal.

Shares of the parent company, Mahindra and Mahindra, rose as much as 1.8% after the news.

In January last year, the Airbus unit had signed a deal with India's Tata group to manufacture civilian helicopters together.

(Reporting by Ashish Chandra in Bengaluru; Editing by Mrigank Dhaniwala)

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April 7 (Reuters) - Mahindra and Mahindra Ltd MAHM.NS:

• MAHINDRA ADVANCED TECHNOLOGIES INCORPORATED AS WHOLLY OWNED SUBSIDIARY

Source text: ID:nPLX1D32BD

Further company coverage: MAHM.NS

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By Aditi Shah, Shivangi Acharya and Aftab Ahmed

NEW DELHI, April 2 (Reuters) - India plans to lower import tariffs on electric cars, rejecting requests from local automakers to delay such cuts by four years, as New Delhi prioritises closing a trade deal with the United States, government and industry sources told Reuters.

The automakers are lobbying Prime Minister Narendra Modi's government to delay any cut in EV tariffs until 2029, and then phase in a reduction to 30% from as high as roughly 100%, two industry sources and one government official said.

However, New Delhi is serious about lowering EV tariffs - which have riled U.S. President Donald Trump and his ally Tesla TSLA.O CEO Elon Musk - and the sector is set to be part of the first tranche of tariff reductions in a planned bilateral trade deal, this government official - and another - said.

"We have protected the auto industry for far too long. We will have to open it up," the second government official said, adding the plan was to lower tariffs "significantly", including on EVs.

The officials declined to disclose the size of the planned duty cut given ongoing negotiations with Washington.

The sources, who are familiar with the talks and the auto industry's demands, declined to be named as they are not authorised to speak to the media.

India's commerce ministry and the Society of Indian Automobile Manufacturers, which represents carmakers in the world's third-largest auto market, did not immediately respond to emails seeking comment.

New Delhi's plan to cut duties on EVs and other goods comes as it seeks to build bridges with Trump - who has referred to India as a "tariff king" - even as he prepares to announce reciprocal tariffs on trading partners later on Wednesday.

An immediate cut would be a victory for Tesla, which has finalised showrooms in Mumbai and New Delhi to begin selling imported cars in the South Asian nation this year. Trump has said it is currently "impossible" for Tesla to sell in India and it would be unfair if it had to build a factory there.

But it would be a setback for domestic players like Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS, which have invested millions of dollars in local EV manufacturing, with more to come, and lobbied against duty cuts.

Automakers fear any agreement with the U.S. would set a precedent for ongoing trade talks with the European Union and Britain, intensifying competition in India's small but fast growing EV sector, three of the sources said.

India's EV sales, dominated by Tata Motors, accounted for just 2.5% of total car sales of 4.3 million in 2024, and the government wants to increase this to 30% by 2030.

Carmakers are open to some immediate duty cut on gasoline models, followed by a phased reduction to 30%, but say their EV investment is tied to New Delhi's incentive programme for local manufacturing that runs until 2029, and allowing cheaper imports before then would hurt their competitiveness, the sources added.

"They are not so rigid on ICE (internal combustion engine vehicles) but have sought careful consideration for EV duties given early investment commitments," the first government source said.

(Reporting by Aditi Shah, Shivangi Acharya and Aftab Ahmed. Additional reporting by Aditya Kalra in New Delhi. Editing by Mark Potter)

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March 27 (Reuters) - Force Motors Ltd FORC.NS:

• INDIA GOVERNMENT: INKS 25 BILLION RUPEES CONTRACTS WITH MAHINDRA AND MAHINDRA, FORCE MOTORS FOR 5,000 LIGHT VEHICLES

• INDIA GOVERNMENT: 25 BILLION RUPEES CONTRACTS INCLUDE ANOTHER CONTRACT WITH ARMOURED VEHICLE NIGAM LIMITED FOR ANTI-TANK WEAPON PLATFORM

Source text: [ID:]

Further company coverage: FORC.NS

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March 24 (Reuters) - Mahindra and Mahindra Ltd MAHM.NS:

• MAHINDRA AND MAHINDRA LTD - M&M EVALUATES STRATEGIC OPPORTUNITIES FOR GROWTH

• MAHINDRA & MAHINDRA- NO MATERIAL EVENT, INFORMATION THAT REQUIRES DISCLOSURE

• MAHINDRA & MAHINDRA- RESPONDS TO REPORT ON CO IN TALKS TO BUY PROMOTER STAKE IN SML ISUZU

Source text: ID:nNSE6h8JJR

Further company coverage: MAHM.NS

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March 21 (Reuters) - Mahindra and Mahindra MAHM.NS will increase prices of its SUVs and other commercial vehicles by up to 3% from April, the company said on Friday, becoming the latest Indian carmaker to raise prices to combat rising costs.

Already, market leader Maruti Suzuki MRTI.NS, Tata Motors TAMO.NS and Hyundai Motor India HYUN.NS have said they will hike prices between 2% and 4% from next month.

These higher expenses are due to rising commodity prices, elevated import duties on raw materials and supply chain disruptions.

Mahindra and Mahindra said its price increases will vary depending on the model of the vehicle.

(Reporting by Ananta Agarwal in Bengaluru; Editing by Savio D'Souza)

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By Aditi Shah

NEW DELHI, March 14 (Reuters) - Skoda Auto plans to manufacture electric cars in India and will invest in the country by itself if its search for a local partner fails, the Czech carmaker's CEO said, as its parent Volkswagen Group fights a $1.4 billion tax demand case.

VW's local unit Skoda Auto Volkswagen India is embroiled in a legal tussle with the country's tax department over allegations that it misclassified imports of some Audi, VW and Skoda cars to evade higher duties.

If the company loses the battle, against what it calls an "impossibly enormous" demand, it will need to fork out $2.8 billion including penalties and interest, which could become a matter of survival, one of VW's lawyers said last month.

CEO Klaus Zellmer told the media this week that he was unable to comment on the "ongoing, very critical procedure", but that Skoda is targeting India as it looks to the world's third-largest car market for growth outside Europe.

"(It) is still our will and our strategy to form a joint venture to be even stronger in India ... but if there's no right partner we stay single and be still attractive and successful," he told reporters at a post-earnings press conference.

Skoda has been leading Volkswagen's India strategy since 2018, but sales have remained low with the Volkswagen and Skoda brands together accounting for just 2% of India's 4 million units a year car market.

But with stricter vehicle fuel efficiency standards set to kick in from 2027, all carmakers will have to introduce EVs, and Skoda believes its access to the Volkswagen Group's EV technology might give it an edge.

"We can offer very innovative, very cost efficient solutions for battery electric vehicles, and this is our strategy also for India," Zellmer told reporters on the virtual call.

Skoda has an agreement with India's Mahindra & Mahindra MAHM.NS to supply some EV components. Zellmer did not name Mahindra or any other company in terms of potential collaborators, but said talks were ongoing with partners with "local roots".

India, where small cars from Suzuki Motor 7269.T and Hyundai HYUN.NS, 005380.KS dominate the roads, has proved a difficult market for Western carmakers.

But Skoda, which no longer has a big presence in China and exited Russia, says India is a "major focus" for its business.

The company has previously shown interest in a government programme that will offer incentives for local EV manufacturing.

It has also signed an initial agreement with the government in India's western Maharashtra state to invest about $1.7 billion to build EVs.

Zellmer said it was important for Skoda to get its portfolio right in India, a market he said was a "gateway" for Southeast Asia and the Middle East.

"We are really looking for us building on ... one of the biggest potential growth markets globally," he added.

(Reporting by Aditi Shah; Additional reporting by Victoria Waldersee in Berlin; Editing by Kate Mayberry)

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March 13 (Reuters) - Ashok Leyland Ltd ASOK.NS:

• INDIA'S FEB 2-WHEELER SALES 13,84,605 UNITS - INDUSTRY BODY

• INDIA'S FEB 3-WHEELER SALES 57,788 UNITS - INDUSTRY BODY

• INDIA'S FEB TOTAL DOMESTIC PASSENGER VEHICLE SALES 3,77,689 UNITS - INDUSTRY BODY

• INDIA AUTO INDUSTRY BODY: UPCOMING FESTIVITIES OF HOLI, UGADI IN MARCH LIKELY TO CONTINUE TO DRIVE DEMAND

Further company coverage: ASOK.NS

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By Aditi Shah

NEW DELHI, March 12 (Reuters) - Jaguar Land Rover has shelved plans to build electric vehicles at parent company Tata Motor's TAMO.NS upcoming $1 billion factory in southern India, four people with knowledge of the matter said.

The British luxury car unit was unable to find the right price-quality balance for locally sourced EV parts, three of them said, adding that the decision also reflects slowing demand for electric cars.

"For India, all the work (on JLR electric vehicles) has stopped. Everything has been suspended since about two months," said a supplier source.

Global car brands are revamping their electrification plans amid stiff competition from Chinese players, a shift in demand in favour of hybrids and as governments ease timelines to meet emission rules and EV sales targets.

JLR's decision is also expected to delay plans for Tata Passenger Electric Mobility, Tata's local electric car unit, to launch the first of its premium Avinya models, the sources said.

The cars are to be built on the same platform as JLR's electric vehicles and some components were to have been jointly sourced.

Tata began construction of the new factory, which will also assemble vehicles other than EVs, in September. The plant is slated to produce over 250,000 cars a year when it reaches full capacity in about 5-7 years.

The shelved plans called for JLR to manufacture more than 70,000 electric cars there and Tata's EV unit to build 25,000, the sources said.

The sources were not authorised to speak to media and declined to be identified.

Tata said in a statement to Reuters that the production timelines and choice of models to be built at the new factory in the state of Tamil Nadu will be aligned with Tata and JLR's broader strategy and market requirements.

Tata, the biggest seller in India's nascent EV market, faces growing pressure from rivals like JSW MG Motor and Mahindra and Mahindra MAHM.NS which have launched new, feature-rich models with longer driving ranges.

Tesla TSLA.O is also finalising plans to launch EVs in India, which is the world's third-largest car market with 4 million vehicles sold annually. EV sales currently account for about 2% of total car sales.

ECONOMICS NOT WORKING OUT

In November, JLR hosted a meeting with local suppliers in Mumbai where it shared details of its plans and talked about locally sourcing components.

Some suppliers were asked to provide initial information on the pricing of parts but those talks have now been suspended, according to the sources.

JLR has most of its production in Britain, Europe and China. But it assembles some of its cars like the Range Rover SUVs at Tata's plant in Pune in the western state of Maharashtra.

Tata's EV unit had planned to firm up orders with some suppliers by the end of January but is now making changes to its designs as the economics of its plan are not working without JLR, two of the sources said.

Tata in January pushed back the launch of its Avinya EV to 2026-2027 from an earlier plan for this year. It was not immediately clear if the current situation will cause further delays.

"As part of our rigorous product development process, we continuously evaluate key factors such as design, supply chain readiness, and unit economics to ensure a competitive and high-quality offering," Tata said in its statement.

(Reporting by Aditi Shah; Editing by Edwina Gibbs)

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Repeats item first published on Wednesday with no changes to text

By Shivangi Acharya and Aditi Shah

NEW DELHI, March 5 (Reuters) - The United States wants India to eliminate tariffs on car imports under a proposed trade deal between the two nations, but New Delhi is reluctant to immediately bring down such duties to zero even as it considers further cuts, sources told Reuters.

India's high auto tariffs will feature in formal talks for a bilateral trade deal that are yet to begin, said one of the three sources, all of whom were briefed on the matter, paving the way for American electric vehicle maker Tesla TSLA.O, which is gearing up for an India launch.

Taxes on cars imported into India are as high as 110%, which Tesla chief Elon Musk has criticised as being among the steepest in the world. The EV giant last year shelved its plans to enter the world's third-largest car market for a second time.

Musk has now found support from U.S. President Donald Trump, who has repeatedly railed against India's high taxes and in an address to Congress on Tuesday slammed the country's auto tariffs of more than 100%, threatening reciprocal action.

"The U.S. ask is for India to bring tariffs down to zero or negligible in most sectors, except agriculture," the first source said, adding the expectation on New Delhi eliminating auto tariffs was "clearer than any other".

A second source said India was "listening to the U.S." and had not pushed back, adding it would respond with its position on the tariffs after consulting local industries.

The office of United States Trade Representative, India's trade ministry, and the foreign affairs ministry did not respond to requests for comment.

TRADE WORTH $500 BILLION

After a meeting between Trump and Indian Prime Minister Narendra Modi last month, the two nations agreed to resolve tariff rows and work on the first segment of a deal by the fall of 2025, aiming for bilateral trade worth $500 billion by 2030.

Indian trade minister Piyush Goyal is on a nearly week-long trip to the U.S. and on Tuesday met U.S. Commerce Secretary Howard Lutnick to pursue trade talks. He is also expected to meet the United States Trade Representative Jamieson Greer.

While India is unlikely to relent to U.S. demands to reduce tariffs on auto imports to zero immediately, it has been priming the industry to prepare for a lower tariff regime and be open to competition, said the first source and a fourth person.

Last month, the Indian government met domestic carmakers to decide on any tariff cuts and understand their reservations over taxes going down to zero immediately, the first source added.

India's 4 million-vehicles-a-year car market is one of the most protected in the world and its domestic players have previously argued against lowering tariffs, saying such a move would dry up investment in local manufacturing by making imports cheaper.

The likes of Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS have especially lobbied against lowering import tariffs on EVs, saying it would hurt the nascent sector in which they have invested heavily.

Vowing to avoid protectionist signals on trade, India last month cut import tariffs on nearly 30 items including high-end motorcycles and said it will review surcharges on luxury cars.

(Reporting by Shivangi Acharya and Aditi Shah in New Delhi, additional reporting by Aftab Ahmed; Editing by Alex Richardson)

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By Shivangi Acharya and Aditi Shah

NEW DELHI, March 5 (Reuters) - The United States wants India to eliminate tariffs on car imports under a proposed trade deal between the two nations, but New Delhi is reluctant to immediately bring down such duties to zero even as it considers further cuts, sources told Reuters.

India's high auto tariffs will feature in formal talks for a bilateral trade deal that are yet to begin, said one of the three sources, all of whom were briefed on the matter, paving the way for American electric vehicle maker Tesla TSLA.O, which is gearing up for an India launch.

Taxes on cars imported into India are as high as 110%, which Tesla chief Elon Musk has criticised as being among the steepest in the world. The EV giant last year shelved its plans to enter the world's third-largest car market for a second time.

Musk has now found support from U.S. President Donald Trump, who has repeatedly railed against India's high taxes and in an address to Congress on Tuesday slammed the country's auto tariffs of more than 100%, threatening reciprocal action.

"The U.S. ask is for India to bring tariffs down to zero or negligible in most sectors, except agriculture," the first source said, adding the expectation on New Delhi eliminating auto tariffs was "clearer than any other".

A second source said India was "listening to the U.S." and had not pushed back, adding it would respond with its position on the tariffs after consulting local industries.

The office of United States Trade Representative, India's trade ministry, and the foreign affairs ministry did not respond to requests for comment.

TRADE WORTH $500 BILLION

After a meeting between Trump and Indian Prime Minister Narendra Modi last month, the two nations agreed to resolve tariff rows and work on the first segment of a deal by the fall of 2025, aiming for bilateral trade worth $500 billion by 2030.

Indian trade minister Piyush Goyal is on a nearly week-long trip to the U.S. and on Tuesday met U.S. Commerce Secretary Howard Lutnick to pursue trade talks. He is also expected to meet the United States Trade Representative Jamieson Greer.

While India is unlikely to relent to U.S. demands to reduce tariffs on auto imports to zero immediately, it has been priming the industry to prepare for a lower tariff regime and be open to competition, said the first source and a fourth person.

Last month, the Indian government met domestic carmakers to decide on any tariff cuts and understand their reservations over taxes going down to zero immediately, the first source added.

India's 4 million-vehicles-a-year car market is one of the most protected in the world and its domestic players have previously argued against lowering tariffs, saying such a move would dry up investment in local manufacturing by making imports cheaper.

The likes of Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS have especially lobbied against lowering import tariffs on EVs, saying it would hurt the nascent sector in which they have invested heavily.

Vowing to avoid protectionist signals on trade, India last month cut import tariffs on nearly 30 items including high-end motorcycles and said it will review surcharges on luxury cars.

(Reporting by Shivangi Acharya and Aditi Shah in New Delhi, additional reporting by Aftab Ahmed; Editing by Alex Richardson)

(([email protected];))

By Ira Dugal

This was originally published in the India File newsletter, which is issued every Tuesday. Sign up here to get latest news from India and how it matters to the world.

Elon Musk's Tesla TSLA.O seems to be nudging closer to selling its electric vehicles (EVs) in India, unnerving its automakers. How much of a headache will Tesla be for Indian automakers? That's the focus of our analysis this week.

Also, Indian insurers may pitch for a one-of-its-kind charge linked to New Delhi's air pollution. And the central bank announces a mega cash infusion to ease rates. Scroll down for more on both those stories.

This week in Asia

** Trump orders use of CFIUS to restrict Chinese investments in strategic areas

** Bangladesh and Pakistan resume direct trade after more than 50 years

** Bank of Korea resumes rate cuts as economic risks grow

** OpenAI removes users in China, North Korea suspected of malicious activities

** DBS set to cut 4,000 jobs over 3 years due to AI, CEO says

Namaste India

Tesla is getting ready to hit Indian streets.

The company has selected showrooms in New Delhi and Mumbai and is stepping up hiring plans. Signs that Musk is fast-tracking plans to enter the country come shortly after his meeting with Prime Minister Narendra Modi in Washington earlier this month.

If Musk pushes ahead with his plans to enter India, automakers, who are already struggling with pockets of weak demand and intensifying competition, will have one more battle to fight - holding on to their better-off customers.

Passenger vehicle sales in India grew 4% in 2024, the slowest in four years, industry data showed. And EVs, where many automakers have focused their new launches expecting a consumer shift, have seen patchy demand because of high prices and an inadequate charging network.

Musk has long delayed plans to sell his EVs in India, partly due to the high import duties of nearly 100% that the country levies on them. While that is yet to change, India is reviewing import duties across a number of categories, under the threat of reciprocal tariffs by the United States.

Musk's close relationship with U.S. President Donald Trump may allow him to wrangle some concessions without giving India what it really wants – for Tesla to manufacture in India. Trump has already made his dislike for that idea public, saying it would be "unfair" to the U.S. for Musk to manufacture in India to avoid paying the high levies placed on imported vehicles.

Read this BreakingViews piece by Shritama Bose to understand why Musk is not India's ideal foreign investor.

Technology vs pricing

Tesla's impending entry hit shares of major Indian automakers on Friday. Mahindra and Mahindra MAHM.NS slid 6.2%, while Tata Motors TAMO.NS and Hyundai Motor India HYUN.NS dropped 2.5% and 3.5%, respectively.

Both Mahindra and Tata Motors have previously lobbied against a cut in import taxes on EVs.

Analysts differ on just how much of a dent Tesla can make in the incumbents' market positions in India.

Citi believes Tesla's technology will give it an edge.

Tesla and China's BYD 002594.SZ – which is also expanding its offerings in India – have access to proven technology and manufacturing processes, which will offset the advantages of the incumbents including their wide sales and service networks, said Citi in a February 21 note.

The "hegemony" that local automakers have enjoyed in combustion engine cars has led to many foreign automakers meeting with limited local success in India but that may not hold in EVs, Citi said.

CLSA, though, feels Tesla's tech advantage will be taken away by its pricing.

With various taxes and the import levies, the cheapest Teslas, priced at $35,000 in the U.S., could be sold at around 3.5 million Indian rupees ($40,377). That is almost three times the 1.2-million-rupee average selling price of cars in India.

About two-thirds of the EVs sold are priced under 2 million rupees, according to an estimate from Macquarie Research.

"Factors such as spacious interiors, features, aesthetics, better resale value visibility and right pricing are the key drivers in car purchase decisions, regardless of the powertrain, in our view," CLSA said in a February 21 note.

Will Tesla leave existing brands in the rear view mirror? Write to me with your views at [email protected].

Quote of the week

"We have to start thinking about pollution as a separate factor in the pricing (of insurance) in the sense that can we then start executing a particular charge for the areas which are impacted by it?"

Amitabh Jain, the operating chief of Star Health STAU.NS, India's No.1 standalone health insurer, is among industry executives pitching for an increase in health insurance premiums for New Delhi, which has seen toxic air year after year.

The pollution has led to more Delhi residents seeking treatment for asthma, chronic obstructive pulmonary disease (COPD) and cardiovascular conditions in 2024, higher than in any prior year, insurers are arguing.

Read that Reuters exclusive here.

Market matters

The Indian central bank announced a mega $10 billion forex swap as a way to infuse cash into the Indian banking system.

The swap followed large dollar sales from the central bank to protect the rupee, which in turn had withdrawn rupee liquidity from the banking system, hurting the central bank's effort to bring down interest rates and lift growth.

The central bank had infused liquidity worth 3.6 trillion Indian rupees over the past five weeks but analysts had said more will be needed.

Short-term bond yields and the forward premium on the rupee fell in response to the RBI's swap.

($1 = 86.6840 Indian rupees)

(Reporting by Ira Dugal; Editing by Muralikumar Anantharaman)

(([email protected]; +91-9833024892;))

India File is published every Tuesday. Think your friend or colleague should know about us? Forward this newsletter to them. They can also subscribe here.

Feb 25 - By Ira Dugal, Editor Financial News, with global Reuters staff.

Elon Musk's Tesla TSLA.O seems to be nudging closer to selling its electric vehicles (EVs) in India, unnerving its automakers. How much of a headache will Tesla be for Indian automakers? That's the focus of our analysis this week.

Also, Indian insurers may pitch for a one-of-its-kind charge linked to New Delhi's air pollution. And the central bank announces a mega cash infusion to ease rates. Scroll down for more on both those stories.

THIS WEEK IN ASIA

** Trump orders use of CFIUS to restrict Chinese investments in strategic areas

** Bangladesh and Pakistan resume direct trade after more than 50 years

** Bank of Korea resumes rate cuts as economic risks grow

** OpenAI removes users in China, North Korea suspected of malicious activities

** DBS set to cut 4,000 jobs over 3 years due to AI, CEO says

NAMASTE INDIA

Tesla is getting ready to hit Indian streets.

The company has selected showrooms in New Delhi and Mumbai and is stepping up hiring plans. Signs that Musk is fast-tracking plans to enter the country come shortly after his meeting with Prime Minister Narendra Modi in Washington earlier this month.

If Musk pushes ahead with his plans to enter India, automakers, who are already struggling with pockets of weak demand and intensifying competition, will have one more battle to fight - holding on to their better-off customers.

Passenger vehicle sales in India grew 4% in 2024, the slowest in four years, industry data showed. And EVs, where many automakers have focused their new launches expecting a consumer shift, have seen patchy demand because of high prices and an inadequate charging network.

Musk has long delayed plans to sell his EVs in India, partly due to the high import duties of nearly 100% that the country levies on them. While that is yet to change, India is reviewing import duties across a number of categories, under the threat of reciprocal tariffs by the United States.

Musk's close relationship with U.S. President Donald Trump may allow him to wrangle some concessions without giving India what it really wants – for Tesla to manufacture in India. Trump has already made his dislike for that idea public, saying it would be "unfair" to the U.S. for Musk to manufacture in India to avoid paying the high levies placed on imported vehicles.

Read this BreakingViews piece by Shritama Bose to understand why Musk is not India's ideal foreign investor.

TECHNOLOGY VS PRICING

Tesla's impending entry hit shares of major Indian automakers on Friday. Mahindra and Mahindra MAHM.NS slid 6.2%, while Tata Motors TAMO.NS and Hyundai Motor India HYUN.NS dropped 2.5% and 3.5%, respectively.

Both Mahindra and Tata Motors have previously lobbied against a cut in import taxes on EVs.

Analysts differ on just how much of a dent Tesla can make in the incumbents' market positions in India.

Citi believes Tesla's technology will give it an edge.

Tesla and China's BYD 002594.SZ – which is also expanding its offerings in India – have access to proven technology and manufacturing processes, which will offset the advantages of the incumbents including their wide sales and service networks, said Citi in a February 21 note.

The "hegemony" that local automakers have enjoyed in combustion engine cars has led to many foreign automakers meeting with limited local success in India but that may not hold in EVs, Citi said.

CLSA, though, feels Tesla's tech advantage will be taken away by its pricing.

With various taxes and the import levies, the cheapest Teslas, priced at $35,000 in the U.S., could be sold at around 3.5 million Indian rupees ($40,377). That is almost three times the 1.2-million-rupee average selling price of cars in India.

About two-thirds of the EVs sold are priced under 2 million rupees, according to an estimate from Macquarie Research.

"Factors such as spacious interiors, features, aesthetics, better resale value visibility and right pricing are the key drivers in car purchase decisions, regardless of the powertrain, in our view," CLSA said in a February 21 note.

Will Tesla leave existing brands in the rear view mirror? Write to me with your views at [email protected].

QUOTE OF THE WEEK

"We have to start thinking about pollution as a separate factor in the pricing (of insurance) in the sense that can we then start executing a particular charge for the areas which are impacted by it?"

Amitabh Jain, the operating chief of Star Health STAU.NS, India's No.1 standalone health insurer, is among industry executives pitching for an increase in health insurance premiums for New Delhi, which has seen toxic air year after year.

The pollution has led to more Delhi residents seeking treatment for asthma, chronic obstructive pulmonary disease (COPD) and cardiovascular conditions in 2024, higher than in any prior year, insurers are arguing.

Read that Reuters exclusive here.

MARKET MATTERS

The Indian central bank announced a mega $10 billion forex swap as a way to infuse cash into the Indian banking system.

The swap followed large dollar sales from the central bank to protect the rupee, which in turn had withdrawn rupee liquidity from the banking system, hurting the central bank's effort to bring down interest rates and lift growth.

The central bank had infused liquidity worth 3.6 trillion Indian rupees over the past five weeks but analysts had said more will be needed.

Short-term bond yields and the forward premium on the rupee fell in response to the RBI's swap.

($1 = 86.6840 Indian rupees)

(Reporting by Ira Dugal; Editing by Muralikumar Anantharaman)

(([email protected]; +91-9833024892;))

Repeats for Indian morning readership, no change to text.

By Aditi Shah

NEW DELHI, Feb 21 (Reuters) - India's EV policy, which offers import tax cuts for foreign automakers investing in the country, will restrict them from using funds spent on charging infrastructure for such relief, increasing their car manufacturing, a government document shows.

India last year announced a policy aimed at attracting Tesla TSLA.O to manufacture EVs in the country and let such foreign carmakers import cars at a 15% tariff, from around 100% now, but only if they invest at least $500 million for a factory.

But the policy will mandate that automakers can count only 5% of their total EV investment as coming from creation of charging infrastructure, even if they spend much more on the power network, according to government document detailing draft rules which is not public but was seen by Reuters.

The government's plan comes just as Tesla gets closer to entering India with imported cars, having finalised two locations for showrooms. The restriction could upset those automakers who may want to invest a bigger chunk of their planned India investments into creating charging networks, which remain far and few in India.

An industry source privy to discussions with the government said the call is being taken as New Delhi wants companies to prioritise manufacturing, and not just charging networks.

In India's nascent EV market, many buyers have shied away from making purchases due to lack of fast chargers.

"Expenditure incurred on charging infrastructure would be considered up to (a) maximum 5% of the committed investment," the 47-page draft document from January 2025 stated.

The government is holding consultations with carmakers and other stakeholders on the draft rules and will finalise them by next month, said a source with direct knowledge of the matter.

India's ministry of heavy industries, which is spearheading the new policy, did not respond to an email seeking comment.

Tesla in a job advert last week said it is also looking for a "charging developer" who would "develop and manage pipeline of new charging" sites, and select locations for deployment.

The EV giant's chief Elon Musk put on hold his manufacturing investment plans for India last year, amid falling electric car sales globally.

Tesla's immediate India plan is to import cars and sell them in India. Musk and U.S. President Donald Trump however have repeatedly said India's tariffs for cars are too high.

The new draft rules said companies which commit to India manufacturing will also need to meet a minimum turnover of $577 million by the end of the fourth year of operation, and $866 million by the fifth year, to be eligible for lower tariffs on up to 8,000 electric cars per year.

If they fail to do so, they will need to pay a penalty of between 1%-3% of the revenue shortfall.

Other foreign automakers like Hyundai 005380.KS, HYUN.NS and Toyota Motor 7203.T have shown interest in making EVs in India at their existing and new factories.

(Reporting by Aditi Shah; editing by David Evans)

(([email protected]; +91-11-4954 8023, +91-11-3015 8023; Reuters Messaging: twitter: @aditishahsays))

By Aditi Shah

NEW DELHI, Feb 21 (Reuters) - India's EV policy, which offers import tax cuts for foreign automakers investing in the country, will restrict them from using funds spent on charging infrastructure for such relief, increasing their car manufacturing, a government document shows.

India last year announced a policy aimed at attracting Tesla TSLA.O to manufacture EVs in the country and let such foreign carmakers import cars at a 15% tariff, from around 100% now, but only if they invest at least $500 million for a factory.

But the policy will mandate that automakers can count only 5% of their total EV investment as coming from creation of charging infrastructure, even if they spend much more on the power network, according to government document detailing draft rules which is not public but was seen by Reuters.

The government's plan comes just as Tesla gets closer to entering India with imported cars, having finalised two locations for showrooms. The restriction could upset those automakers who may want to invest a bigger chunk of their planned India investments into creating charging networks, which remain far and few in India.

An industry source privy to discussions with the government said the call is being taken as New Delhi wants companies to prioritise manufacturing, and not just charging networks.

In India's nascent EV market, many buyers have shied away from making purchases due to lack of fast chargers.

"Expenditure incurred on charging infrastructure would be considered up to (a) maximum 5% of the committed investment," the 47-page draft document from January 2025 stated.

The government is holding consultations with carmakers and other stakeholders on the draft rules and will finalise them by next month, said a source with direct knowledge of the matter.

India's ministry of heavy industries, which is spearheading the new policy, did not respond to an email seeking comment.

Tesla in a job advert last week said it is also looking for a "charging developer" who would "develop and manage pipeline of new charging" sites, and select locations for deployment.

The EV giant's chief Elon Musk put on hold his manufacturing investment plans for India last year, amid falling electric car sales globally.

Tesla's immediate India plan is to import cars and sell them in India. Musk and U.S. President Donald Trump however have repeatedly said India's tariffs for cars are too high.

The new draft rules said companies which commit to India manufacturing will also need to meet a minimum turnover of $577 million by the end of the fourth year of operation, and $866 million by the fifth year, to be eligible for lower tariffs on up to 8,000 electric cars per year.

If they fail to do so, they will need to pay a penalty of between 1%-3% of the revenue shortfall.

Other foreign automakers like Hyundai 005380.KS, HYUN.NS and Toyota Motor 7203.T have shown interest in making EVs in India at their existing and new factories.

(Reporting by Aditi Shah; editing by David Evans)

(([email protected]; +91-11-4954 8023, +91-11-3015 8023; Reuters Messaging: twitter: @aditishahsays))

Recasts with India sales target, EV plans, analyst comment

By Daniel Leussink and Aditi Shah

TOKYO, Feb 20 (Reuters) - Japanese carmaker Suzuki Motor has trimmed its sales target in India, its "most important market", and scaled back its line-up of electric car launches, even as it plans to expand global sales by a third to 4.2 million vehicles by fiscal year 2030.

Suzuki 7269.T expects to sell about 2.5 million cars in India by March 2031, down from an October 2023 target of 3 million, and will launch just four EVs in the country instead of six planned, the company said on Thursday.

The sales cut in India, Suzuki's biggest market by revenue and volumes, comes as local unit Maruti Suzuki MRTI.NS has been losing ground to new, feature-rich cars and SUVs from rivals Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS.

The scaleback on EV launches coincides with a slowdown in their sales globally and Tesla's TSLA.O impending entry in India, the world's third-largest car market, where it has finalised locations for its first showroom.

Maruti's share of India's passenger vehicles market is down to 41% from a recent peak of about 51% by March 2020. It had set a market share target of 50% by March 2026 which it now expects to achieve by March 2031.

"The competitive environment is becoming increasingly severe, and the quality of product functions, equipment and services required by customers is increasing," Suzuki said in a presentation laying out its five-year strategy to March 2031.

A shift in buyer preferences in India has brought a steep decline in the sales of small cars, a mainstay for Suzuki, and a rise in the popularity of mid-sized SUVs which the Japanese company has been late in introducing.

Suzuki now plans to beef up its line-up of SUVs in India and expand manufacturing capacity there to 4 million units a year "at appropriate time" from about 2 million. The company had earlier planned to scale up to 4 million units by March 2031.

India is still at the forefront of Suzuki's expansion and will receive 60% of a planned investment of 2 trillion yen ($13 billion) by that date, and will be its production hub for global exports to the Middle East and Africa, including for EVs.

"India is Suzuki's most important market where we are putting the most effort," President Toshihiro Suzuki told a strategy briefing in Tokyo on Thursday.

"The sales situation of BEVs is not favourable, particularly in Europe. This shows that new technologies cannot grow without customer acceptance," he said, adding that Suzuki was working on a mix of technologies including hybrids and bio gas.

Suzuki also said it would target an overall operating profit margin of at least 10% by 2030, up from 9.2% in the past financial year, and aims for revenue of 8 trillion yen by the 2030 financial year, a jump of 49%.

Gaurav Vangaal, an S&P Global analyst in India, said the mid-year plan reflected a strategic recalibration in response to competition and a slowing global approach towards EV transition.

($1=150.1200 yen)

(Reporting by Daniel Leussink in Tokyo and Aditi Shah in New Delhi; Editing by Edwina Gibbs and Clarence Fernandez)

(([email protected]; Twitter: @danielleussink;))

Feb 19 (Reuters) - Mahindra and Mahindra Ltd MAHM.NS:

• MAHINDRA & MAHINDRA - MAHINDRA GROUP AND ANDURIL PARTNER TO DEVELOP AUTONOMOUS MARITIME SYSTEMS AND AI COUNTER-UAS TECH

Further company coverage: MAHM.NS

(([email protected];))