Mahindra & Mahindra, India’s biggest SUV maker, has agreed to buy a controlling stake of 55% in Bangalore-based Reva Electric Car. The move is aimed at giving Mahindra access to technology as demand for alternative-energy vehicles is predicted to rise and is seen by analysts as being part of Mahindra’s long-term strategy.
Mahindra is buying Reva stock and about US$10m in new shares, it said in a statement to the Bombay Stock Exchange on Wednesday. No overall value has been given for the transaction.
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GM has been working with Reva on developing an electric version of its Spark small hatchback; Reva would not comment on whether the deal with GM would continue under Mahindra’s ownership but Chetan Maini, Reva’s head of technology and strategy, told reporters that GM was looking at “other options”.
Reva has sold more than 3,500 vehicles worldwide and operates in 24 countries. It is building a plant in the southern Indian state of Karnataka to make as many as 30,000 vehicles a year.
Last month Mahindra took over Renault’s stake in a joint venture to built the Logan in India as it expands its passenger car portfolio. India’s 1.7m new car market is forecast to more than double over the next five years.
“The EV market is poised to grow significantly, and we concluded that in order to seize the opportunity, we needed the resources and experience of a major automotive manufacturer,” Maini said.
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By GlobalDataReva plans to begin selling the lithium-ion-powered Reva NXR as early as October. The car will cost about EUR14,995 (US$18,482) in Europe, the automaker said last year. The three-door, four-seat hatchback has a top speed of 65mph and a range of 100 miles per charge.
Reva was established in 1994 as a venture between the Maini Group and California-based AEV. The company showed its first electric car in May 2001.
