NEW DELHI: Hero Electric has signed a Memorandum of Understanding (MoU) with the Rajasthan government to invest about Rs 1200 crore to set up a manufacturing facility that would churn out 2 million units of electric vehicles (EVs) a year.
Located in Salarpur industrial region, the state-of-the-art manufacturing is spread over 170 acres and will commence commercial production by the end of 2023, as per the statement issued by the automaker.
Naveen Munjal, managing director, Hero Electric, said, “This mega manufacturing facility is part of our capacity enhancement to boost EV adoption across India. It will allow the state to spearhead a clean mobility solution shift and promote ecological tourism practices.”
Hero Electric, which also is one of India’s oldest and largest electric two-wheeler companies, has been aggressive in expanding its manufacturing capacity as demand for battery-powered two-wheelers is on the rise, with some studies estimating its penetration to reach 25-30% in the overall two-wheeler sales over the next 3-5 years.
This has prompted new-age companies like Ola Electric, Okinawa Scooters and Ather Energy, as well as legacy players such as Bajaj Auto and TVS Motor, to invest heavily in EVs. Another Hero Group company, Hero MotoCorp, which recently had a legal tussle with Hero Electric, is also gearing up to launch its first electric scooter. Hero Electric had earlier set a target to of 5 million units annual capacity by 2025.