Mahindra & Mahindra will kick off its long planned investment in a Rs 4,000-crore automobile project in Tamil Nadu with an agreement to be signed with the State Government in May.
The investment to be made over a seven-year period following the agreement will be in two stages at Cheyyar about 100 km to the south of Chennai.
In the first stage, a Rs 2,000-crore test track will be established. This will be followed up with an automobile plant with an additional investment of Rs 2,000 crore, said Pawan Goenka, President, Automotive and Farm Equipment Sectors, M&M.
He was talking to media persons at a curtain raiser event to announce the two-day Global Investors Meet being organised by the State Government in May when the company will sign the agreement.
He said the test track will be done "immediately'' on a 255-acre land parcel that is available with it. The automobile plant will need an additional land of about 200 acres and will be considered after the company reaches full capacity at its Chakan plant in Maharashtra.
M&M makes a wide range of automobiles, including commercial vehicles, pick-ups and SUV at Chakan.
Goenka declined to put a time frame on when the company is likely achieve saturation point at Chakan or share the details of the present capacity utilisation.
Addressing the curtain raiser, Goenka said M&M has had a happy experience with its investments in Tamil Nadu and support from the State.
The Mahindra World City, an industrial township it has set up about 50 km from Chennai, has attracted investments worth over Rs 5,000 crore by leading multinationals and domestic manufacturers and generated over 36,000 jobs.
Automotive plant
The investment in an automotive plant by M&M in Tamil Nadu has been in the pipeline for a few years with reports indicating that the company plans to set up a tractor unit or an automobile factory.
However, the project has been delayed over the years and M&M in the interim period invested in the automobile plant in Chakan and a tractor plant in Zaheerabad Andhra Pradesh.