Sona Comstar, DENSO to form JVs for EV powertrain systems in India

Sona Comstar and Japan's DENSO Corporation announced two joint ventures in India. The partnership will develop and manufacture advanced electric and hybrid powertrain systems for two-wheelers, passenger vehicles, and commercial vehicles.

Sona BLW Precision Forgings Ltd, popularly known as Sona Comstar, on Wednesday announced definitive agreements with Japan's DENSO Corporation to establish two joint ventures focused on developing, manufacturing and marketing advanced electric and hybrid powertrain systems for multiple vehicle segments.

The partnership will combine DENSO's expertise in automotive electrification, product engineering and research and development with Sona Comstar's engineering capabilities, cost-competitive manufacturing and understanding of the Indian automotive ecosystem. The proposed joint ventures will be anchored in India and will develop powertrain products aimed at meeting global standards of quality and performance, as the automotive industry accelerates its shift towards electrification.

Details of the Joint Ventures

One of the joint ventures will focus on high-voltage liquid-cooled traction inverters, traction motors and generators for electric and hybrid passenger vehicles, commercial vehicles and other larger vehicle applications. DENSO will hold a 51 per cent stake and have management control, while Sona Comstar will hold the remaining 49 per cent.

The second joint venture will focus on electric and hybrid powertrain systems for two-wheelers and three-wheelers, including air-cooled traction inverters, traction motors and generators and e-Axles. For this venture, Sona Comstar will transfer its existing electric traction motor and controller business for two-wheelers and three-wheelers to its wholly owned subsidiary through a slump sale. DENSO, directly or through its affiliates, will subsequently acquire a 49 per cent stake in the entity at an enterprise value of Rs 17,500 million, while Sona Comstar will retain a 51 per cent stake and management control.

Leadership on the Partnership

Commenting on the development, Sona Comstar MD and Group CEO Vivek Vikram Singh said, "This partnership marks an historic milestone in Sona Comstar's journey as a mobility technology company and reflects the capabilities we have built across advanced electric powertrain systems over the years." He said the partnership would bring together the complementary strengths of the two companies to develop advanced electric and hybrid powertrain solutions for four-wheelers and larger vehicles, while also accelerating the company's existing electric powertrain business for two- and three-wheelers.

DENSO Head of Powertrain Systems Business Group Tsuneo Maebara said India was an important region where diverse forms of mobility coexist and electrification is advancing at significant scale. "Through this partnership, we will bring together the respective strengths that both companies have built over the years to provide electrification solutions that address the diverse needs of customers in India," Maebara said.

Transaction Details

The transaction remains subject to relevant regulatory approvals and customary closing conditions.

Both companies will license intellectual property and know-how to their respective majority-owned joint ventures against payment of royalty. (ANI)

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