Hybrid metal matrix composites have superior strength to weight ratio as compared with conventional composites or superalloys. This characteristic makes them suitable for different advanced industries such as aerospace, automobile, and biomedical. Mechanical and thermal energy based processes have their own limitations to machine these composites due to superior mechanical properties and melting of reinforcement particles, respectively. Researchers are trying to machine metal matrix composites by the electrochemical process with the aim to achieve better machining quality, but low material removal rate and oxide layer formation on the machined surface has emerged as the main limitation. A hybrid variant of electro-chemical machining (ECM) and conventional grinding has capability to overcome these limitations. Keeping this in view, the experimental set-up of electro-chemical surface grinding (ECSG) has been developed with the aim to compare the machining characteristics of the hard-to-cut hybrid metal matrix composite Al–SiC–Gr with the ECM process. The machining performances have been compared on the basis of material removal rate, surface roughness, and microcrack width in the machined component. The influence of some important input process parameters on these performance characteristics have been analyzed scientifically. Experimental results show that the ECSG process improves the machining performance by reducing or eliminating the oxide layer from the machining zone due to suitable grinding effects. Material removal rate, surface roughness, and microcrack width were improved by 68%, 24%, and 40%, respectively, by using the ECSG process. The formation of the large size oxide layer with high crack width on the machined surface was observed at high voltage, high electrolyte concentration, and at low table speed.