Mahindra is finally gearing up to start production of its upcoming MPV, codenamed U321, which will allow the company to take on the likes of the Toyota Innova Crysta and the Tata Hexa. Mahindra has recently invested Rs 1,500 crore in its facilities in Nashik and Igatpuri, with the major chunk going to Nashik where the U321 will be produced. The remaining part goes to the Igatpuri plant to augment the company’s engine assembly operations.
This investment has led to the Nashik plant being granted Ultra Mega Project (UMP) status by the government of Maharashtra. The status allows the company to claim tax on gross sales and then reclaim the VAT paid at the end of the year, a benefit that will probably allow for an even more competitive pricing of products. However, once the GST is implemented then of course there might be changes that may be impossible to predict at this point in time.
The granting of this status will also lead to a huge boost in employment opportunity creation in the region since the norms of the UMP status require the beneficiary to create job openings for at least 3,000 people.