As per the agreement, Mitsui and VDL together will invest $100 million (approx Rs 830 crore) in EKA Mobility for ‘significant’ minority stakes. The resources will be utilized to scale up research and development and enhance manufacturing capacity.
EKA Mobility, which commissioned a production unit in Pune earlier this year, plans to scale up production capacity to roll out 5000 electric buses and 6000 light commercial vehicles per annum in the first phase. This would be further increased to produce 12,000 electric buses and commercial vehicles each in the medium term, as per market demand.
Sudhir Mehta, Founder & Chairman, EKA Mobility, told ET, this is one of the largest and most significant partnerships in the new mobility segment in India, which will bring together the strengths and expertise of three leading automotive conglomerates in Asia & Europe to accelerate the development and adoption of innovative electric mobility solutions.
“Under the cooperation, EKA Mobility will receive strategic investments from Mitsui and VDL Groep, to develop a range of electric buses and light commercial vehicles for last-mile connectivity. These will be made locally, for sale in the country as well as in markets in Africa, Asia and Latin America.”
As part of this partnership, VDL Bus & Coach (a subsidiary of VDL Groep and a leading European manufacturer of electric buses & coaches) will support EKA Mobility by transfer of technology to produce electric buses in India for the Indian market. Mitsui, on its part, will extend support to EKA for exports to select emerging markets as well as in establishment of systems & process.
With this partnership in place, EKA Mobility is eyeing to grow turnover of $ 2 billion in the next 5 years. “India has 1-1.2 buses /1000 people, which is even lower than 6-7 buses/1000 ppl in markets like Africa. The potential to grow is immense, especially given the focus the government has towards encouraging the transition to e-mobility in public transportation systems”, Mehta added.
EKA Mobility already has an order book for 700 electric buses and 5000 electric light commercial vehicles. These will be designed & manufactured in India, at EKA’s proposed state-of-the-art manufacturing facilities in Madhya Pradesh and Maharashtra.
The partnership also aims to scale up sourcing of EV components from India. Rolf-Jan Zweep, CEO VDL Bus & Coach, said, the company sees many opportunities in India, which is “obviously a promising growth market”. “With this cooperation, we foresee especially many synergy benefits in the areas of procurement and development”, Zweep informed.
EKA Mobility is one of the commercial vehicle manufacturers approved under the Champion OEM Scheme & EV component manufacturing scheme of the Auto PLI policy. Nobuyoshi Umezawa, GM of Mobility Business Division in Mitsui & Co. India: “Through the cooperation of EKA, VDL, and Mitsui, we aim to contribute to “Make in India” by leveraging EKA’s engineering and local network, and VDL’s technological capabilities. Furthermore, we would like to utilize Mitsui’s global network to export EKA’s products to overseas markets and contribute to creating eco-friendly societies”.
Mitsui & Company is a global trading and investment company with presence in more than 60 countries. The Euro 5.75 billion VDL Groep, which has more than 100 operating companies, has businesses across tech, mobility, energy, Infratech and foodtech industries.
