Auto and auto components major Mahindra and Mahindra (M&M) has formed a tripartite joint venture with global auto giants, France’s Renault and Nissan from Japan, to set up a Rs. 4000 crore-greenfield automobile plant at Oragadam, near Chennai in Tamil Nadu. The facility will have a capacity to manufacture 400,000 units by 2009 and would be used by all the three auto majors for production of vehicles from their respective stables. M&M will hold 50% stake in the new venture, while the rest will be jointly head by Renault and Nissan of Japan. The Tamil Nadu government would provide land and incentives for the project. M&M President, automotive sector, Pawan Goenka was named the chairman of the JV company.
The Tamil Nadu government has already had some land and would acquire more to meet the needs of the facility, which would come up on a 925-acre plot. The new facility would see to it that those displaced due to acquisition of land for the project would be relocated at a place convenient to them. The new company would also start vocational schools in the area to train students and absorb them in the facility.
The project would consist of integrated automobile manufacturing facilities which would include engine plant, transmission plant, press shop, body shop, paint shop and assembly line, an official press release here said, adding this would be India's biggest vehicle manufacturing centre at a single location. It would involve manufacture of 50,000 tractors per annum and there would be a Mahindra Research Valley in the Mahindra World City near Chennai.
The project would result in gross value addition of about Rs. 18,000 crores per annum to Tamil Nadu's GDP and the additional investment in the State by vendors and supporting service providers was expected to be about Rs. 10,000 crores. The new facility would provide direct employment to 5000 people and indirect employment to many more.
M&M and Renault already have an existing JV which is manufacturing the Logan brand of cars.
Read the articles in The Economic Times and Business Standard.
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