Ideal Motors and Mahindra & Mahindra Ltd in a joint venture will invest Rs. 2.5 billion for the assembly of automotive vehicles in Sri Lanka.
The land for the project has already been obtained in Kalutara and the production would commence from September 25. The joint venture company hopes to assemble around 100 four wheelers monthly mainly targeting the rural markets in Sri Lanka.
Mahindra will hold a 35% stake in the JV, while Ideal Motors will have a 65% stake.
Sanjay Jadhav, Vice President, Head of International Operations - AFS (South Asia), Mahindra & Mahindra Ltd, said, “Sri Lanka is one of Mahindra’s top three export markets, and this announcement with Ideal Motors builds the foundation for newer opportunities for both of us.”
“This is also the first time that we would be assembling this automotive model (to be announced in three months) outside India. We see the need to anticipate new market trends, explore alternatives and build powerful synergies here in Sri Lanka.”
Nalin Welgama, Founder and Executive Chairman Ideal Group, said he was proud to be a pioneer in setting up the first automotive assembly in direct partnership with automobile giant Mahindra.”
“This Joint Venture will only build upon the wonderful relationship both companies have shared for nearly a decade. The new facility will not only contribute to human capital development, but will also enable collective development of local automotive components manufacturers to international standards under the global expertise of Mahindra. This is a leap forward for the Industry, adding value to the meaning of ‘Made in Sri Lanka’ and opening broader opportunities for national growth”
There will also be several tier I Indian automotive component manufactures who has already stated to set up industry in Kalutara which will be major plus point for Sri Lanka economy.
Aravinda de Silva, Deputy Chairman of the Ideal Group said, “Ideal Motors is a customer-centric automotive company with the vision to be the ultimate choice for value based products and services, ensuring growth amidst tough competition. Today’s strategic partnership represents a quantum leap for both companies as it will enable us to deliver products at affordable prices.”
“Today is like winning the world cup as it’s a red letter day for our company.”