Auto Sector News Update

Mahindra Kinetic Deal: Mahindra & Mahindra who had evinced interest in entering the two wheeler segment earlier have entered into an agreement with Kinetic Motor to form a joint venture company which will be called Mahindra Kinetic Scooters and Motorcycles. Mahindra will own 80% stake in the new company and Kinetic will own the rest. Mahindra have agreed to buy the manufacturing assets of Kinetic for Rs. 110 crore. The utility major have been planning a foray into the two wheeler market for a while now, with news of a joint venture with a Chinese manufacturer also filtering through and reports of interest in buying MV Agusta recently.

Mahindra have also recently bought an Italian two wheel design house called Engines Engineering. What is not clear as of now is whether the Taiwanese major SYM, which holds an 11% stake in Kinetic is a part of the venture or not.

Chrysler talking to Tata, Fiat: The No. 3 manufacturer in the US market, Chrysler is said to be in talks with Tata Motors for sale of its Jeep Wrangler in the Indian car market as well as other Asian markets where Tata has reach. Also Chrysler is talking to Fiat for lease of its production units in the US.

Discussions with Tata also include the sale of the electric version of the Ace mini truck. Tata had earlier shown the battery powered version of the Ace.

In other news Fiat will now handle the financing of Jaguar and Land Rover in Europe while Tata is open to the idea of Fiat selling the Nano in markets where Tata is still not present.