Mahindra opens its first automotive assembly plant in Sri Lanka

Expanding its global footprint, Indian auto major Mahindra & Mahindra on Saturday opened its first completely knocked down automotive assembly plant here in joint venture with Ideal Motors of Sri Lanka.

Mahindra & Mahindra (M&M) claims it is the first major passenger car assembly unit in Sri Lanka with local sourcing.

Christened Mahindra Ideal Lanka Pvt Ltd, the local assembly plant located in Welipenna near Colombo on Saturday also rolled out its first product, the compact SUV, KUV100 petrol K6+ variant, which will be followed by other variants in the near future.

By local assembly and manufacturing operations, Mahindra Ideal Lanka is expected to save significantly in taxes, pricing the KUV100 close to 3.2 million Sri Lankan rupees (INR 12.85 lakh).

The assembly unit will enable the firm arrest high import duties in the island nation on completely built units, estimated to range from 100 to 300 per cent based on engine size or cubic capacity.

With an investment of 200 crore Sri Lankan rupees (around INR 80 crore), the plant will have production capacity of 5,000 units per annum.

Addressing the inauguration ceremony, Sri Lankan Prime Minister Ranil Wickremesinghe said he plans to make the country's manufacturing export-oriented.

He also thanked his Indian counterpart Narendra Modi for the country's assistance to the island nation.

Mahindra & Mahindra Managing Director Pawan Goenka said, "Investment of 2 billion Sri Lankan rupees is just the beginning. Five thousand capacity is just the beginning. Direct and indirect employment of 200 people is just the beginning. I believe that with the policy support from the government, we can do a lot more."