Mitsubishi Electric to set up AC, compressor manufacturing facility in Tamil Nadu

  • Industry News
  • May 11,23
The government of Tamil Nadu and Mitsubishi Electric Corporation signed a memorandum of understanding (MoU) to build an air conditioner (AC) and compressor manufacturing plant in India. The 52-acre site will be set up in Thiruvallur District, Tamil Nadu.
Mitsubishi Electric to set up AC, compressor manufacturing facility in Tamil Nadu

A contract to build a Rs 1,895 crore factory in India was signed by the Tamil Nadu state government and Japan's Mitsubishi Electric Corp on May 9. This agreement stands as a rare instance of 100 per cent foreign direct investment (FDI) in India's electronics equipment manufacturing sector.

The funds will go towards building Mitsubishi Electric's first compressor and air conditioner (AC) manufacturing facility in India. A memorandum of understanding (MoU) states that the facility will be built on a 52-acre site in Peruvoyal Village, Gummidipoondi Taluk, Thiruvallur District, by the joint venture Origins by Mahindra.

More than 2,000 people will be employed by the unit, which will produce compressors and room air conditioners. After the MoU, a groundbreaking ceremony was held. The partnership with Mitsubishi comes just a few days before Chief Minister of Tamil Nadu M K Stalin visits Singapore and Japan to invite companies to the state's Global Investor Summit (GIS), which will take place on January 10–11, 2019.

With an initial annual capacity of up to 3 lakh air conditioners and an additional 6.5 lakh compressors by early December 2025, the unit is expected to begin production in October 2025. Stalin claimed that his nation was leading the way in attracting industries and aimed to have a $1 trillion economy by 2030.

The announcement of the manufacturing facility comes almost a month after Mahindra Industrial Park Chennai (MIPCL), a joint venture between Mahindra World City Developers and Japan’s Sumitomo Corporation, signed a lease agreement with Mitsubishi Electric India to set up the facility at Origins.

According to Mitsubishi Electric’s “Advanced and Innovative 2025 Strategy”, launched in November 2021, it aims to sell $10.5 billion worth of air-conditioning and refrigeration systems worldwide by March 2026, with an operating profit of 12 per cent. 

Mitsubishi Electric India (MEI), a subsidiary of the Japanese giant, was established in 2010 to assert its influence by selling imported products. The origin is at NH16 (part of the golden quadrilateral). It is also within the influence area of the Chennai-Bangalore Industrial Corridor (CBIC) and Chennai-Vizag Industrial Corridor (CVIC), near Ponneri. Origins is also close to Chennai’s three major ports (Chennai Port, Ennore Port and Katupali Port), and the transportation to Chennai’s urban business district is very convenient.

Tamil Nadu Industries Minister Thangam Thennarasu, Department Additional Chief Secretary S Krishnan, Guidance Tamil Nadu Managing Director and CEO V Vishnu, MEI Managing Director Kazuhiko Tamura and Mitsubishi Electric Group President Yasumichi Tazunoki attended the MoU signing ceremony.

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