Amara Raja Energy & Mobility has outlined its plans to commence bulk production of lithium-ion cells in 2027, marking a significant step in India’s evolving electric vehicle ecosystem, reported ET News.

Vikram Gourineni, the company’s executive director, cautioned that locally produced cells will initially carry a minimum 15 per cent price premium over imports.

He explained that building a meaningful upstream ecosystem, from raw materials to components, will take time, noting that China spent two decades developing its supply chain. Until domestic manufacturers reach a scale of 8–10 GWh and a supporting supply chain emerges, the economics will not favour EV makers.

The company is targeting the end of next year for the start of bulk production, with Gourineni allowing for a leeway of a quarter or two. Amara Raja will adopt a graduated approach to scaling, beginning this year with cell production at a megawatt-hour scale.

Commercial samples will be supplied to Indian customers for qualification before bulk production begins at its first Gigafactory of 2 GWh in 2027. This facility will primarily serve the electric two-wheeler segment, though the company also intends to supply adjacent sectors such as power tools and lawn and garden equipment to reduce demand concentration risks.

Amara Raja’s plans coincide with similar timelines from TATA Group’s Agratas venture, which is setting up a facility in Gujarat.

The company has earmarked ₹10,000 crore in investments through 2032 to expand its lithium-cell and pack manufacturing capabilities. While the originally planned capacity stood at 16 GWh, Amara Raja sees potential upside given healthy demand growth.

The announcements follow an operational milestone recently achieved by the company, with the cumulative deployment of 1 GWh of lithium energy storage across 50,000 telecom sites nationwide. In a strategic pivot, Amara Raja has revised its capacity allocation across the planned 16 GWh, shifting from a mobility-focused plan to an equal split between mobility and energy storage solutions.

This adjustment reflects the company’s recognition of the growing importance of energy storage alongside electric mobility in India’s clean energy transition.

ET News