Mitsubishi Corp to acquire 32% stake in TVS Vehicle Mobility for Rs 300 cr

TVS Mobility holds dealerships of major companies like Ashok Leyland, Honda, Mahindra and Renault among others, mainly in states like Tamil Nadu, Kerala, Karnataka, AP, Telangana and MP

TVS Mobility and Japanese conglomerate Mitsubishi Corporation on Monday announced a strategic partnership under which the latter will pick up a 32 per cent stake in a newly-formed subsidiary of the Chennai-based group for Rs 300 crore. 

With this, the dealership business of TVS Mobility will transform into the newly-formed subsidiary TVS Vehicle Mobility Solution (TVS VMS) — offering a complete portfolio of services to its customers.

TVS Mobility holds dealerships of major companies like Ashok Leyland, Honda, Mahindra and Renault, among others. These are mainly in Tamil Nadu, Kerala, Karnataka, Andhra Pradesh, Telangana and Madhya Pradesh. The remaining 68 per cent stake in TVS VMS will be held by TVS Mobility. 

 

“The new company is taking over the existing dealership business of TVS Mobility. Mitsubishi is becoming a part of this as it feels its strength can help us in scaling up this business in India. It will also support us to spread this to relevant geographies,” said R Dinesh, director, TVS Mobility.

According to Dinesh, the business model will have the potential to achieve $2 billion revenue in the next three-five years.

“TVS Mobility had pioneered the sales, service and distribution of vehicles through its dealership business in India. This collaboration with Mitsubishi will enable TVS to provide a range of solutions to the entire vehicle mobility ecosystem,” he said.

He added, “After providing integrated and digital platforms for the independent aftermarket, the vehicle mobility business will provide innovative and digitally-enabled solutions to our customers, be it in enterprises, corporates or fleet owners. We will expand our partnership with vehicle manufacturers to provide integrated solutions across vehicle sales, operating of vehicles and ‘vehicle-as-a-service’ (Micromobility) solutions. This partnership will work towards providing a solution to all stakeholders.”

“The latest investment in the multi-brand dealer TVS VMS widens Mitsubishi’s investment coverage through enhanced service capabilities even further. It 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 models, and other automotive operations,” said Shigeru Wakabayashi, chief executive officer (CEO), automotive and mobility group, Mitsubishi Corporation.

“India has the world’s third-largest market for new automobiles with sales topping 5 million vehicles in 2023. They are expected to grow at 6-7 per cent in the next few years. To gain a downstream foothold in the rapidly-growing Indian market, Mitsubishi has been fostering its relationship with TVS Mobility group. This includes investment in the after-sales services provider TVS Automobile Solutions (TASL),” he added.

TVS Mobility Group is the holding company for the businesses managed by the T S Rajam family members.

The group has a collective annual revenue of around $3 billion in the mobility space. It includes manufacturing, platform for parts distribution and services in the independent aftermarket, and auto retail (India, Sri Lanka and Bangladesh).