Mahindra has signed a memorandum of understanding (MoU) with South Africa’s Industrial Development Corporation (IDC) to explore the possibility of setting up a full-scale vehicle assembly plant in the country. This agreement initiates a detailed feasibility study to assess whether a Completely Knocked Down (CKD) facility would be viable.
Mahindra South Africa is also expanding its production capacity at its existing assembly facility, operated by AIH Logistics in KwaZulu-Natal. This move highlights the company’s strengthening footprint and long-term commitment to the South African automotive sector.
A Major Step Towards Local Manufacturing
The MoU signifies a crucial step in evaluating expanded local manufacturing, with the study set to analyze key aspects such as South Africa’s automotive industry incentives, export market potential, workforce development, and supply chain infrastructure.
Additionally, the feasibility study will review logistics, potential plant locations, and supply chain integration, including considerations for new energy vehicles (NEV).
Although the MoU demonstrates Mahindra’s intent to investigate local manufacturing opportunities, it remains an evaluation process at this stage. No formal commitment has been made to establish a CKD facility until the study is completed and a final decision is reached.
Mahindra’s Growth in South Africa
The MoU announcement coincides with Mahindra South Africa celebrating a major achievement—the production of its 25,000th locally assembled Pik Up on February 24, 2025.
In August 2023, Mahindra showcased its next-generation Pik Up to a global audience in South Africa, further reinforcing the country’s role in its international strategy.
“Reaching the milestone of our 25,000th locally assembled Pik Up is a testament to Mahindra’s growing footprint and long-term commitment to South Africa. As we continue to strengthen our operations, this MoU allows us to explore the feasibility of expanding our local assembly capabilities. This study will provide valuable insights into the potential for deeper integration into South Africa’s automotive landscape while supporting the country’s industrial growth objectives,” said Rajesh Gupta, CEO of Mahindra South Africa.
Alignment with South African Automotive Master Plan 2035
Acting divisional executive for Industry Planning and Project Development at the IDC, Rian Coetzee, emphasized that Mahindra’s commitment to ramping up its feasibility study aligns with the objectives of the South African Automotive Master Plan (SAAM) 2035. The plan focuses on strengthening South Africa’s competitiveness as an automotive assembly location.
“Depending on the outcome of the feasibility study, there is great potential for the company to increase its production output in South Africa—a factor that has the potential to create employment opportunities,” said Coetzee.
As Mahindra continues to solidify its presence in South Africa, the outcomes of this feasibility study could mark a transformative step for both the company and the country’s automotive industry.
