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Indian Automaker to Outsource Work to Detroit

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Published on : Jul 20, 2015

Though India receives work from most automobile companies, but in a reverse trend, a major Indian automobile company is going to outsource major automotive engineering to the United States., though the company is not into selling vehicles here.

In a major twist, when Mahindra & Mahindra plans to increase abilities globally for vehicle development, it has recognized there is sufficient talent in India. The executives of the company worked towards creating a technical center in Italy, California, Germany, and England along with some other locations, before zeroing on Detroit. The executives thought Detroit stood as the true center for automotive development and testing, as stated by Richard Haas, who is the CEO of the North American Center of Mahindra & Mahindra located in Troy.

Currently, the center has a staff of about 80, mostly which are engineers with plans of expansion. Mahindra also owns an electric scooter manufacturing unit in Ann Arbor, Michigan, which will start production in November. The two facilities in Michigan have a combined investment ofUS$30 million.

Also, Mahindra is vying to bag a US$5 billion contract with the United States Postal Service, following which the company will supply 180,000 vehicles every year for five years.

It is anticipated the automaker based in Mumbai could sell SUVs and pickup vehicles in the U.S., although the earlier goal to achieve by 2010 did not succeed, which is partly due to issues which the company selected for distribution.

The importance that the company puts on Detroit know-how is explained from the fact that it set up a US$5 million technical center in the city of Troy, to develop future products to merchandise on the continent in future.

As stated by the vice president at the technical Center of Mahindra North America, most companies set up R&D in India, but Mahindra is doing opposite.