Japanese multinational conglomerate SoftBank is reportedly in preliminary talks with Indian emobility giant Mahindra Electric to formulate a strategic partnership. The alliance might also include SoftBank getting a minority stake in Mahindra Electric.
As per a Business Standard report, SoftBank and Mahindra Electric’s tie-up is still uncertain. The report adds that Mahindra is talking to a diversified range of potential investors. These investors also include players who can help Mahindra in developing EVs, powertrains, chargers and other emobility solutions.
However, SoftBank can help Mahindra Electric to push its EV solutions. SoftBank has a subsidiary mobility business, SB Energy Corp, which combines renewable energy with EV battery cells.
Last month, Mahindra Electric CEO Mahesh Babu told CNBC that the company is looking for a strategic partner or a private equity investor to scale up its operations. Babu added, “Mahindra Electric is a separate entity under the Mahindra group. Right now, Mahindra and Mahindra is the major investor in Mahindra Electric and will continue to be.”
Babu also noted that Mahindra Electric wants to provide complete mobility solutions and not limit itself to manufacturing electric vehicles (EVs). Currently, Mahindra Electric is working on an electric three-wheeler Treo, battery packs, motors and a mobility solution platform Nemo.
As far as SoftBank is concerned, it has been focusing on EVs in India. The company has also invested in cab-hailing service Ola’s EV business Ola Electric Mobility, valuing the company at $1 Bn.
Mahindra is also looking to localise EV production in India by using parts manufactured in India. However, battery cells will not be a part of this localisation drive. To facilitate localisation of EVs, Mahindra has also invested INR 250 Cr in its production unit in Bengaluru, which will be used for manufacturing motors, chargers and assembling batteries.
Mahindra is also setting up its R&D unit in a 14 acre land near Bengaluru airport. The company has invested INR 500 Cr in the unit, which will be used to manufacture high voltage batteries and high power starter motor, among other EV components. The R&D unit is going to be operational by the end of this year.
Moreover, Mahindra Electric is also looking to export its EV powertrains to the South Korean and European markets, starting from 2020. For this, the company has partnered with SsangYong Motor in South Korea but is looking for partnership opportunities in Europe.