Absence of local cell manufacturing biggest hurdle for EVs: RC Bhargava

Maruti chairman says India's biggest roadblock to scaling up EVs is that no firm is producing battery cells in the country

Maruti Suzuki India Chairman R C Bhargava on Tuesday said the absence of local cell manufacturing is India’s biggest roadblock in scaling up electric vehicles (EVs). He noted that no company is producing battery cells in the country and that setting up a plant costs nearly Rs 20,000 crore apart from securing scarce raw materials.

 

China dominates the global battery ecosystem, controlling nearly 85 per cent of the world’s cell production capacity along with much of the processing of lithium and cobalt.

 

On the rare-earth magnet shortage caused by restrictions imposed by China since April, he said: “That may be getting solved. I hear that rare earth magnet problem might get solved, but it was a warning signal.”

 

China, which processes and exports more than 90 per cent of the world’s rare-earth magnets, sent shockwaves through India’s automobile sector when it imposed export restrictions in April 2025.

 

During his recent two-day visit to New Delhi, Chinese Foreign Minister Wang Yi reportedly assured India that Beijing would address key export concerns, including rare-earth magnets, fertilisers, and tunnel-boring machines.

 

When asked when Maruti Suzuki India (MSIL) planned to manufacture EV batteries in India, Bhargava said: “I don’t know. We haven’t started. Nobody is making battery cells in India. That is one of the problems of EVs today. People are packaging cells and actual production of cells is not taking place.”

 

“Setting up a battery plant is a capital-intensive endeavour. I am told that it takes up to Rs 20,000 crore to set up a battery plant. On top of that, raw material is a problem,” he said, while speaking to reporters at the firm’s Hansalpur plant after Prime Minister Narendra Modi launched MSIL’s first electric car, the e-Vitara, for exports.

 

Bhargava said it was possible to ensure raw material supply by partnering with a Chinese company and giving it a majority stake in such a venture. “No one has done it till now,” he added.

 

“There is a problem in making large-volume EVs because of the batteries. If I am importing the batteries, it is costly. If we package batteries, we get 15 per cent advantage. We are not even packaging batteries here. So, personally, I would be hesitant about making a large commitment on the domestic market because that would mean importing a large number of batteries,” he said.

 

He added that no one currently knew the solution to the problem of battery localisation. “I wish some of our Indian scientists would come up with a new chemistry and avoid this dependence on other countries,” he said.

 

Bhargava also said MSIL was not going to make any “fundamental difference” in the Indian EV market.

 

“We will be one of the EV suppliers in India. Till now, everyone said MSIL is not in the EV market and has missed the bus. So, we ran and caught on with the bus,” he said.

 

When asked if MSIL was delaying the launch of the e-Vitara in India because it was unsure about the EV market here, he replied: “We are not unsure. We should have enough production to meet the export order as well as the domestic needs of our dealers in India. If I start selling my electric car in India, all dealers should get a reasonable number of cars.”