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Expecting Indian automobile industry to grow by 6-7% in FY 2023-24, says MG Motor India MD

MG Motor India aims to increase annual production capacity to 1,40,000 in 2023, said its MD Rajeev Chaba, adding that ‘profitable & sustainable’ growth is the company's focus.

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Greater Noida: MG Motor India has entered the second phase of its journey with a focus on profitability and sustainability over the next three years, its president and managing director Rajeev Chaba told ThePrint on the sidelines of the Auto Expo 2023.

“For us, the first phase was the last four years where the focus was to have a good foundation, in which I think we have done a reasonable job. In the second phase, we are enhancing the capacity of our manufacturing plant to go up to 1,40,000 units by the end of this year. So if we can fill that plant and we can be profitable… that is the second phase… for the next three years that will be the focus,” he said.

With a plant in Halol in Gujarat’s Panchmahal district, MG Motor India has an annual production capacity of about 1,20,000 units. On Wednesday, the company announced the prices for its next-gen Hector, ranging between Rs 14.72-22.42 lakh (ex-showroom), while also unveiling a line-up of 14 production-ready vehicles at the Auto Expo 2023.

Asked about his outlook for the Indian automobile industry’s projected growth in FY 2023-2024, Chaba said 2022 was a good year with the industry growing at about 25 per cent year-on-year, largely because of pent-up demand and a shift in preference for driving after the pandemic. “But that is over. Now the industry will go for nominal growth based on the GDP (gross domestic product) of the country. I am expecting a single-digit growth of 6-7 per cent in line with the GDP growth.”

MG Motor India sold 50,000 vehicles last year, a growth of 20 per cent over 2021. 

Chaba added, “We didn’t do as well as the industry (which grew by 25 per cent), mainly because we had supply constraints and chip shortages. But now we’re seeing that supplies are improving and there should be demand due to refreshed Hector and also the new EV that we will bring out this year. So we’re targeting 80,000 volumes this year, which is quite a high growth.”

While the company expects its market share to increase to 4-5 per cent in the next 3-4 years from around 1.5 per cent at present, Chaba maintained that the company remains focused on profitability and sustainability. 

Replying to a query, he added that first-time buyers account for about 30 per cent of industry sales “because entry levels are no longer that cheap”. 

“The prices have gone up and I think we need to make that segment attractive for first-time buyers…if you want to increase penetration, I think that segment needs to be addressed.”

Asked if MG Motor India will address that segment, Chaba denied any plans to that effect for now.

(Edited by Amrtansh Arora)

Also Read: After double digit growth in ‘best year ever’, Mercedes Benz to launch 10 models in India in 2023


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