Japan-based Mitsubishi Electric has plans to invest Rs18.91bn ($231.2m) to build an air conditioner manufacturing facility in India, reported Reuters.

The Indian subsidiary of Mitsubishi Electric will employ 2,000 people at the manufacturing facility.

Mitsubishi Electric India has signed a memorandum of understanding with the state of Tamil Nadu to set up the manufacturing unit for room air conditioners and compressors, reported Swarajya.

The facility will be built near Gummidipoondi in the Tiruvallur district.

Mitsubishi Electric India intends its facility to manufacture precision air conditioning and variable refrigerant flow for commercial use.

Production at the facility is expected to commence in October 2025, reported The Hindu Business Line.

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This is Mitsubishi’s first such plant in the Asian country to help cater to the growing demand for air conditioners.

The investment by the company is routed as 100% foreign direct investment.

The facility will be built on 52 acres at Origins by Mahindra in Peruvoyal village, of Gummidipoondi taluk in the Thiruvallur district.

It will initially have an annual production capacity of up to three million room air conditioners.

By the beginning of December 2025, this capacity is expected to more than double to 6.5 million compressors.

This project is expected to provide opportunities for several ancillary industries to enter the state of Tamil Nadu and subsequently cut imports.

The initiative is part of Mitsubishi Electric’s Advance & Innovation 2025 Strategy launched in 2021, under which it targets worldwide sales of air conditioning and refrigeration systems to be worth $10.5bn by the fiscal year ending March 2026.