NEW DELHI: Auto component major Sona Comstar has formed a joint venture with Jinnaite Machinery to enter the Chinese electric vehicle market with an investment of $12 million (about Rs 100 crore). Sona Comstar will invest $12 million and have a 60% stake, while JNT will contribute $8 million in assets and business to the joint venture in the first phase.
The JV will commence operations in the second half of financial year 2026 to fulfil existing orders from EV and non-EV customers. Sona said that they will manufacture and supply driveline systems and components to automotive OEMs in China and globally.
“The JV will manufacture and supply driveline systems and components to automotive OEMs in China and globally. The Board has approved the binding Term Sheet, as mutually agreed between Sona Comstar and JNT. The JV is expected to commence operations in the second half of the current financial year,” said Comstar in an exchange filing on Sunday.
Shares of Sona BLW Precision Forgings Ltd (Sona Comstar) surged as much as 3.48% to Rs 496.45 apiece on the NSE on Monday morning.
Sona Comstar is the largest supplier of differential assemblies for battery electric vehicles) in North America and ranks among the top suppliers in Europe.
Jinnaite Machinery operates a world-class foundry utilizing patented technology to manufacture complex castings and molds. JNT has strong customer base in the automotive, off-highway, aviation, railway, and marine sectors, including leading Chinese automotive OEMs, as well as North American, European, and Japanese OEMs.
"As the largest electric vehicle market in the world and a leader in EV technologies, China offers tremendous opportunities for innovation and growth. By leveraging the strengths of both partners, this venture is well-positioned for strong growth, and it has the potential to become a key supplier of driveline solutions for electric vehicles in the region. With a robust order book already in place, we expect operations to commence later this year," said Vivek Vikram Singh, MD & Group CEO of Sona Comstar.
China is the world's largest automotive market, especially for electric vehicles. In 2024, annual EV sales in China reached 11 million', accounting for two-thirds of global EV sales. Chinese OEMs dominate this market, accounting for 76% of global EV sales last year. Their share in international markets has also risen significantly, with exports increasing from 1 million in 2020 to over 6 million in 2024.
Sona Comstar said that it is natural for any company with aspirations to be a global EV supplier to be part of the Chinese market and supply chain.