Groupe PSA and Nidec Corporation, through...

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Groupe PSA and Nidec Corporation, through Nidec Leroy-Somer Holding, intendto work together in the field of electric traction motor. For this purpose, Nidec Leroy-Somerand Groupe PSA entered into a joint venture agreement on December 4,2017.Closing of suchtransaction remains subject to antitrust clearance and employee representative consultation.Groupe PSA makes the strategic choice to anchor in France the design and production of the main components of the electric traction powertrain.

Nidec Leroy-Somer and Groupe PSA have acknowledged the strategic importance oftraction motor in coming electrification ageand agreed mutual cooperation for developing state of the art high-performance and competitive electrictraction motor range for electrified vehicles - Mild-hybrid, (MHEV), Electric Vehicles (“EV”) and Plug-in Hybrid (“PHEV”) to meet the needs of Groupe PSAand other potential OEMs.
The aim of the partnership is to design, develop, manufacture and sell a range of efficient electric traction machines. The joint-venture will then engage R&D, manufacturingand sales for high-performanceelectric traction motor mainly to Groupe PSA,and to other OEMs later,by combining PSA’s automotive OEMstrengthsand Nidec Leroy-Somer’s leading expertise of motor and related electrical equipment.

Purpose and Background of the Transaction
As an anticipation of energy transition towards a cleaner mobility,electrification is the key to both solving global warming and controlling air qualitywith a well to wheel approach. Given the above trend, OEMs are acceleratingtheirshift towards electrified vehicletechnologies. Along with this trend, electrification of automobiles has beenexpanding and the market of electric motor for automotive is foreseen to doubleits size to JPY 6 trillion (€ 45 billion) in 2030. Nidec has been also active in this trendand developing products with its superior motor expertise.

Nidec has been actively developing a new growth platform with particular focus on automotive business. In its midterm strategic goal Vision 2020 it has targeted to achieve JPY 700 billion to 1 trillion (€ 5,4 to 7,6 billion) of sales in automotive sector in 2020.

Nidec Leroy-Somer, acquired by Nidec on February2017, is theleadingelectric motor companyin France serving all industry sector and renowned for its high quality productsproviding the best value to customers.
Groupe PSA,which is a European champion with the second position on the European market,has been actively accelerating its shift to electrified vehicles (MHEV, PHEV, EV). As part of the energy transition process and in line with the technological offensive spelled out in its “Push to Pass”strategic plan, Groupe PSA is focused on diversifying its technological offering with plug-in hybrid petrol engines and next-generation electric powertrains.

Information on the joint venture :

  • Foundation : 1er quarter 2018, subject to closing
  • Headquarters : Carrières sous Poissy, Paris region, France
  • R&D facilities : Carrières sous Poissy, Paris region, France
  • Production facilities : Trémery, Metz region,France
  • Shareholders:50% Nidec Leroy-Somer Holding/50% Groupe PSA
  • Investment : € 220 Million

Effect on Financial Performance for the Current Fiscal Year
The Transaction is expected to have no significant impact on Nidec’s consolidated financial performance for the fiscal year ending March 31, 2018. Nidec will make additional disclosure on a timely basis in accordance with the rules of the Tokyo Stock Exchange upon determination of further details.

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