The joint venture will build lithium-ion batteries and energy storage solutions to power the growth of India’s electric vehicle market.
Exide Industries and Leclanche have announced the launch of a new joint venture to build lithium-ion batteries and energy storage solutions to power the growth of India’s electric vehicle market. The exclusive joint venture (JV) agreement was signed on in June 2018, addressing India’s transition to green energy and clean transportation.
Well timed JV, ideally positioned to be a leading provider to emerging multi GWh storage markets for electric vehicles and grid connected applications in India
Exide Industries Ltd, India’s largest manufacturer of lead acid storage batteries and power storage solutions provider (BSE: 500086), and Leclanche SA (SIX: LECN), one of the world’s leading energy storage solution companies, headquartered in Switzerland, announced today a joint venture to build lithium-ion batteries and provide energy storage systems for India’s electric vehicle market and grid-based applications.
With all the major cities in the world suffering from record-breaking pollution levels, there is an urgent need for radical new ways to power transport. Countries all over the world are working to find alternative solutions to reduce harmful NOx emissions, which are damaging to human health and the environment.
As part of the JV, Leclanche will provide access to its knowhow and intellectual property for lithium-ion cells, modules and battery management systems and Exide Industries will leverage its extensive sales network and brand. As a result of this unique combination, the JV is ideally positioned to be a leading provider of storage solutions for electric vehicles and energy storage applications in India and will also contribute to developing solutions to increase the amount of renewable energy that is used and reduce India’s dependence on fossil fuels.
The JV’s production plant will be based in Gujarat. Exide Industries, which is committed to setting up large-scale manufacturing of lithium-ion batteries, will be the majority shareholder and Leclanche will be the strategic minority shareholder of the JV. A module and battery pack assembly line is expected to be operational by Q2 2019 and a lithium-ion cell production plant is expected to be in operation by mid 2020. In the intervening period, cells will be sourced from Leclanche’s plant in Willstatt, Germany.
The JV will focus on e-transport, stationary energy storage systems and specialty storage markets. In e-transport, the target segment is fleet vehicles including e-buses, e-wheelers and e-rickshaws.
GautamChatterjee, CEO of Exide Industries, said: “Leclanche SA is the perfect partner for them in India. The Company brings superior technology, modules and battery management systems, as well as immediate access to engineering resources to build market-ready products.
“This ideally compliments Leclanche’s leading position in the lead acid storage battery market in India and will allow Leclanche to take the lead in the lithium-ion battery industry, which is expected to grow significantly in the next few years.
“Efforts to develop alternate state-of-the-art technologies such as lithium-ion batteries and energy storage solutions are an important step in tackling the environmental challenges.”
Anil Srivastava, CEO of Leclanche, said: “It is a huge honour that Leclanche has been chosen by Exide Industries, India’s largest battery manufacturer, to partner with them in their quest to help India achieve its zero emissions goals and reduce the country’s dependence on fossil fuel.
“Exide’s selection of Leclanche as its partner of choice is a testament to Leclanche’s deep knowhow and IP and a significant endorsement of the world-leading cell and energy storage technologies, which are the product of strong heritage and a decade of investment in lithium-ion R&D and production.
“In a region that is expected to be one of the world’s largest and fastest growing markets for electric vehicles, the JV shall provide Leclanche with giga-scale procurement volumes, which will help reduce costs, and increase recurring annuity revenues, generating recurring stable revenue growth for the Company.
“This is an important milestone in the stated growth strategy and further evidence that the opportunity for Leclanche is now. Leclanche is looking forward to working with Exide Industries in delivering the best that Leclanche has to offer: superior cell technologies, IP and knowhow that combine high quality German engineering and Swiss precision with deep experience in the design and implementation of battery storage solutions.”
Energetica India speaks to Exide Industries to learn more
Energetica India: What are the growth drivers for lithium-ion batteries and energy storage systems in India?
Exide Spokesperson:We feel India offers one of the strongest opportunities for growth in the lithium-ion batteries business. We are looking at both e-mobility and stationary power storage requirements and solutions. The government is seized of the fact that to reduce urban pollution e-mobility is perhaps the only way forward and all the necessary impetus is being provided by the government. We see e-mobility - both in the personal vehicle and commercial vehicle space - happening in India at a rapid pace.
We also see a huge demand from the solar power generation industry where the power generated by the solar panels will need to be stored in lithium ion batteries. This will emerge as a huge opportunity for our country, as indeed in the whole world.
Energetica India: What kind of investment is Exide looking at for the lithium-ion batteries plant in Gujarat?
Exide Spokesperson:Exide Industries hasn't spelt out the details of the investment plans as yet. We will make all the investments that are necessary to establish our presence in this field. We have just announced a joint venture with Leclanchè of Switzerland. The factory facility has already been purchased in Gujarat. As and when we make the investments we will announce them. Also one must note that Exide is a zero debt and highly cash rich company. Therefore investment will not be a problem for the company.
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