Mahindra & Mahindra plans to expand its Zaheerabad plant in Andhra Pradesh to produce passenger vehicles and light commercial vehicles (LCVs). The automaker currently produces tractors at the plant but aims to invest INR 2.5 billion (USD 45.5 million) to enable production of passenger vehicles and LCVs with a gross vehicle weight rating of less than one tone. M&M is targeting a combined annual production capacity of 92,000 units for the two categories and has approached the state government for tax incentives, claims the report, adding that the government has granted 100% reimbursement of value-added tax or sales tax for a period of 10 years from the date of commencement of commercial production, or to the extent of 100% of investment made, whichever is earlier.

The report claims that the government has also stipulated that at least 80% of new employment should be given to workers from the state in order for the company to be eligible for the incentives.