India’s push towards electric vehicles (EV) is likely to bring boom times to automotive parts makers such as Sona BLW Precision Forgings.
Sona BLW – based near Delhi – started investing in EV parts in 2015 and supplies them to carmakers in North America, Europe and China.
The company produces drivetrain components such as motors and gears and will invest about $130 million over the next three years towards its electrification push, chairman Sunjay Kapur said.
With carmakers investing billions of dollars to build EVs, parts suppliers are also diversifying their business towards new and clean technologies and moving away from petrol-reliant supply chains.
“All our new investments will go towards electrification,” Kapur said, adding that the bulk of Sona’s order book of $2.4 billion over the next few years is for EV components.
Partnerships with Global Companies
The company has entered into partnerships with global companies to build electric motors and is also working with Israel’s IRP on developing magnet-less motors to cut dependence on key raw materials that are in short supply.
The early bet on EVs globally has helped the company scale its manufacturing capacity in India, giving it a headstart in the country in terms of cost and technology, Kapur said.
India wants to accelerate the push to EVs to meet its climate and carbon reduction goals, and Prime Minister Narendra Modi’s administration is offering companies billions of dollars in incentives to build clean cars and their components.
The government is aiming for 30% of total car sales to be electric by 2030 from a fraction today.
“If you want to invest in EVs, infrastructure and components (in India), you need to look at larger markets. We look at markets outside of India and that knowledge we bring back to India to fuel growth here,” Kapur said.
- Reuters, with additional editing by George Russell