Eicher Motors Limited (EML) and Volvo Group have announced plans to establish a 50:50 joint venture to strengthen their financing, leasing and allied financial services operations in India. The proposed structure will see EML invest up to ₹750 crore for a 50% equity stake in Volvo Financial Services (VFS) India, as approved by the company’s board. The final investment amount will be determined at the time of closing, subject to regulatory approvals.

The proposed entity is intended to function as a captive financing arm for products across VECV, Eicher Motors and Volvo Group in India, further deepening integration across the automotive value chain.

Deepening 18-year partnership across manufacturing and financing

The move builds on a long-standing partnership between Eicher Motors and Volvo Group, which already operate the VE Commercial Vehicles (VECV) joint venture, established in 2008. The new financial services JV extends this collaboration into vehicle financing, aimed at improving customer access to credit and enhancing lifecycle value offerings.

Siddhartha Lal, Chairman, Eicher Motors Ltd., said the expansion marks a strategic step in widening the partnership into financial services. “Expanding our highly successful 18-year partnership with Volvo Group, Eicher is now entering the vehicle financing business in India through a new joint-venture. This JV combines Volvo’s global financial services expertise and Eicher’s local knowledge and network,” he said.

He added that the proposed structure will enable Eicher to strengthen customer experience across the value chain. “The JV will serve Eicher, Volvo, and Royal Enfield customers in India and presents an opportunity for EML to operate in an important segment of the value chain, using financing as a lever for a superior customer experience,” Lal said.

Captive finance model to support faster credit access

Volvo Financial Services, the Volvo Group’s captive finance arm, operates in around 40 markets globally and reported assets under management (AUM) of approximately USD 27.4 billion as of end-2025. In India, VFS has been operational for over a decade with AUM of ₹1,825 crore as of March 31, 2026.

The proposed JV will combine VFS’ global expertise in structured financing with Eicher’s extensive product portfolio and distribution network, with the aim of improving efficiency and accelerating decision-making in customer financing. The companies said this integration will help streamline access to credit solutions across commercial vehicle customers and dealers.

Upon completion, the JV entity will issue fresh equity shares to EML. The transaction remains subject to regulatory approvals, with closing expected to follow the completion of all formalities as per the agreed structure.