TVS Mobility announced on Monday that it has formed a new joint venture with the Japanese conglomerate Mitsubishi Corporation (MC) to offer vehicle mobility solutions in India. As part of the new partnership, Mitsubishi Corporation will first invest INR 300 crore to start a 50-50 joint venture company named TVS Vehicle Mobility Solutions. To establish a vehicle mobility ecosystem in the country, the new brand aims to offer services like fleet operating solutions, new vehicle sales, and vehicle-as-a-service models.
The joint venture intends to meet the partners' vision for vehicle ownership and operation, including material handling equipment, commercial vehicles, and passenger cars. The new business model will have the potential to generate $2 billion in income over the course of the next three to five years. TVS Mobility earlier operated as TV Sundram Iyengar & Sons. It has established its presence in the country’s competitive automotive market. Through the new agreement, its dealership business will be split off into a joint venture called TVS Vehicle Mobility Solutions.
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The Director of TVS Mobility, R Dinesh, said, “TVS Mobility, had pioneered the sales, service, and distribution of vehicles market through its dealership business in India. This collaboration with MC will enable TVS to provide a range of solutions to the entire vehicle mobility ecosystem. After providing integrated and digital platforms for the independent aftermarket, the vehicle mobility business will provide digitally-enabled solutions to customers, be it enterprises, corporates or fleet owners.”
The partners would also expand partnership with vehicle manufacturers to provide integrated solutions across vehicle sales, operating of vehicles and Vehicle-as-a-Service solutions, he added.
The CEO of Mitsubishi's Automotive and Mobility Group, Shigeru Wakabayashi, said that the company will help to scale up the new operation via its global experience and best practices. "The latest investment in the multi-brand dealer TVS VMS widens company's investment coverage through enhanced service capabilities even further and should propel its aim to develop comprehensive mobility solutions spanning not only after-sales services and multi-brand sales, but also vehicle-as-a-service model, and other automotive operations."
As of now, India is the third-largest automotive market in the world. The Indian automotive market is estimated to grow by 6 to 7% every year; customers are now shifting from owning a car to renting one. The new company is aiming to use its array of mobility solutions to take advantage of these trends.
