Sandhar Technologies to Enter into Joint Venture (JV) with Jinyong
Sandhar
Technologies expands its automotive components portfolio with the addition of
audio panel under an agreement with Jinyoung Electro-Mechanics
India: The renowned Indian auto components
maker, Sandhar Technologies has signed a Joint Venture (JV) agreement with the
Korean automotive component manufacturer, Jinyong to produce audio panel,
specifically for Hyundai Mobis.
Earlier, Hyundai Mobis was mainly importing
all its car parts, however, this new joint venture deal would assist the
company to procure high quality components, domestically. Post joint venture,
the newly formed company, Jinyong Sandhar Mechatronics, is anticipated to
initiate production of components at the Sandhar Technologies existing facility
based in Chennai, India by August 2017.
Jayant Davar, Founder, Co-Chairman &
Managing Director of Sandhar stated, “I am very happy to announce that Sandhar
and Jinyong are taking their relationship to the next level by doing this 50-50
joint venture, with both partners holding equal shares.”
"India is a very large automotive
market with a number of well-established Korean companies. The strengthening of
our existing relationship with Sandhar through this joint venture gives us an
opportunity to cater to Hyundai in India and expand our footprint as well,”
said Doo-Yung Kim, President, Jinyong Electro-Mechanics (JEM). Besides that,
JEM is also supplying Hyundai Mobis with auto components within Korea.
Sandhar Technologies is already under a
joint venture agreement with JEM to produce multi-functional switches, latches,
relays, switches and other products. Besides manufacturing, the newly formed
joint venture would also supply audio AVN panel assemblies and switches from
its manufacturing unit in Chennai.
TechSci Research believes that Sandhar
Technologies is among leading automotive component manufacturer in the Indian
market. The company is already manufacturing relays, plastic injected
components, lock kits, switchboards, molds, latches, hinges, zinc &
aluminum pressure die castings, etc. By establishing a new joint venture,
Sandhar Technologies would be able to expand its component portfolio with the
addition of audio panel, thus, penetrating the domestic market in an efficient
way. Besides that, the company is anticipated to meet the escalating demand for
auto components in the region, generating an intense competition for existing
players in the industry.
According to a recent report published
by TechSci Research, “India
Automotive Components Market By Vehicle Type (PC, LCV, M & HCV,
2W, 3W & OTR), By Demand Category (OEM vs Replacement), By Component Type
(Engine Parts, Body & Chassis, Suspension & Brakes, etc.), Competition
Forecast and Opportunities, 2011 - 2021”, In 2015, India automotive industry contributed around 7%
to the country’s total GDP. As per Organisation Internationale des
Constructeurs d'Automobiles (OICA), motorization rate (includes passenger cars
and commercial vehicles) in India increased from 20 per 1,000 inhabitants in
2013 to 22 per 1,000 inhabitants in 2014. However, automotive components market
in the country witnessed a decline over the last couple of years, predominantly
on account of currency fluctuations that negatively affected the country’s
automotive industry. However, strong economic growth prospects, rising
disposable income and expanding automobile fleet are expected to drive demand
for automotive components in the country during the forecast period.