MG Motor to go slow on capacity expansion despite strong demand

MG Motor India Ltd, one of the new entrants in the Indian automobile market, has no plan to rush into the high-volume, mass-market segment and will consider introducing hatchbacks and compact sedans only after four to five years, said Rajeev Chaba, president and managing director, MG Motor India.

The firm, which is owned by SAIC Motor Corp. Ltd, also plans to introduce affordable electric vehicles in India, Chaba said in an interview.

MG Motor began its India operations in 2019 with the launch of its Hector sport utility vehicle (SUV).

The company began its manufacturing operations after taking over the Sanand, Gujarat, plant of the US automaker General Motors, which can produce up to 80,000 vehicles a year.

Chaba said MG Motor does not plan to chase volumes in the initial years of its journey in India, and will instead work towards having a sound business structure.

“After four to five years, we can think of getting into the mass market segment like hatchbacks. Our next product, which will be an electric vehicle, will be able to take us a notch up,” Chaba said.

Fuel-efficient and affordable hatchbacks as well as compact sedans especially from Maruti Suzuki India Ltd and Hyundai Motor India Ltd dominate India’s passenger vehicle industry.

Despite the strong demand, MG Motor would not accelerate its capacity expansion, and would restrict monthly vehicle production at up to 3,000-3,500 vehicles until December, Chaba said.