TVS Motor Company is evaluating plans to set up a new manufacturing facility, likely in Gujarat or Madhya Pradesh, as it prepares to support strong growth in volumes expected over the next few years, according to sources familiar with the matter. Sources said plans for a new plant come as the automaker is working toward increasing annual production to about 10 million units by the end of the decade.
- TVS already has three plants across India
- Existing manufacturing facilities are operating near full capacity
- Rising demand in local and export markets has necessitated this development
TVS edging close to Honda in terms of Indian two-wheeler production
It has a big presence in emerging export markets like Africa
TVS has also been ramping up its three-wheeler production, and also has an MoU with Hyundai to manufacture last-mile mobility-focused electric three-wheelers and micro four-wheelers under the partnership. BMW Motorrad and TVS also have a strategic partnership which will yield future models based on the same platform as the incoming F 450 GS and TVS manufactures the BMW CE 02 entirely.
While Tamil Nadu and Karnataka are also being explored for the new facility, sources said locations in Gujarat and Madhya Pradesh are the frontrunners. The facility is expected to come by 2028, and the automaker might be looking at a capacity of 2-2.5 million units, which is scalable. An email query sent to TVS Motor Company seeking comment on the proposed new plant and production plans did not elicit any response.
In 2025, TVS Motor signed an MoU with the government of Karnataka to invest Rs 2,000 crore in the state over the next five years as it plans to set up a global capability center and expand production and engineering capabilities.
Utilisation levels at its existing manufacturing facilities are running high, pushing the company to scale up its capacity, sources said. TVS currently has three manufacturing plants in India - Hosur (Tamil Nadu), Mysore (Karnataka) and Nalagarh (Himachal Pradesh). It also has one overseas facility in Karawang (Indonesia) with an estimated total capacity of 6.4 million units. The company has steadily ramped up output from these plants over the past few years in response to rising demand in both domestic and export markets.
TVS Motor, which surpassed Yamaha last year to become the world’s third-largest manufacturer by sales volume globally, currently holds a two-wheeler market share of close to 20 percent in India. The company has been gradually strengthening its position in the domestic market, with its share rising from around 16 percent three years ago.
The company’s growth strategy, supported by a diversified product portfolio spanning scooters, mid-size and premium motorcycles, electric two-wheelers and international markets, has helped the automaker expand its market presence and improve scale in both domestic and international markets.
Demand trends across the industry are also influencing the company’s capacity planning. Growth in recent years has increasingly shifted toward premium motorcycles, scooters and electric two-wheelers, segments where TVS Motor is building momentum through regular product updates and capacity investments.
Exports remain another important driver for the company. TVS Motor, which also owns fabled British brand, Norton Motorcycles, has built a strong presence in developing markets, particularly in Africa, which contributes meaningful volumes to its overall output. This growing international footprint has increased the need for additional manufacturing capacity to support both domestic and overseas demand.
Electric mobility has emerged as another major factor shaping the company’s expansion plans. TVS Motor has become the leader in India’s electric two-wheeler market, and rising consumer adoption has been pushing production volumes higher. The company’s annual electric two-wheeler output is approaching nearly 5 lakh units, reflecting steady growth in the segment.
Sources said the company is targeting production of around 6.8 million to 7.2 million two-wheelers in FY27, reflecting a potential strong double-digit growth over an estimated production of about 5.7 million units in the financial year 2026. The planned expansion in capacity is essential to support this growth trajectory and maintain supply continuity across markets.
This production target positions TVS Motor closer to Honda Motorcycle and Scooter India in terms of output levels and could intensify competition into a three-way fight for the number one position in India’s two-wheeler market. The company has been steadily narrowing the gap with larger rivals over the past few years, supported by consistent growth across multiple product segments.
TVS Motor’s production rose to an estimated 5.7 million units in FY26, representing growth of about 22 percent compared with the previous financial year. Between April and February of the same year, the company produced 5.09 million units, up 20 percent from the year-ago period, indicating sustained momentum in demand and manufacturing activity.
With inputs from KIRAN MURALI
Suraj Viswanathan
Hormazd Sorabjee
Viraaj Bhatnagar
