TVS Mobility has partnered Mitsubishi Corporation in a bid to strengthen its dealership business. In an exclusive interaction with Financial Express Online, TVS Mobility management confirmed that the existing dealership business will be moved to the JV, TVS Vehicle Mobility and they are targetting revenue around Rs 15000 crore in three years.
Explaining the business model for the JV, R Dinesh, Director, TVS Mobility said, “The idea behind that would be to provide solutions for both off-road equipment and four-wheelers. Within four-wheelers, the main focus will be on the last-mile delivery options, mostly electric as well as in some cases the buses as we see the opportunity evolving. We will start primarily with commercial equipment and mining equipment, B2b corporates and then potentially expand into the closed loop opportunities in direct light commercial vehicles.” The fact that primarily most of these are electric in nature, makes a business case for the JB and that’s where the model lends itself room for profitability.
They reiterated that TVS Vehicle Mobility will service clients Pan-India. G Srinivasa Raghavan, the Global President & CEO of TVS Mobility explained how it addresses synergies and makes a cost-effective alternative and cited an example that if a large construction company, is working on 10,000 projects across the country, “instead of dealing with 20,000 contractors, they have to deal with one player and get all the vehicles and cross-utilise the vehicle and drive further cost efficiency in his business.”
He added that the “existing dealership business that includes clients like Ashok Leyland, Mahindra, Honda will be moved into TVS Vehicle Mobility, and it will continue to run as a dealership business.”
The management clarified that even Mitsubishi is looking at them “as a partner in the mobility space.” Highlighting the scope and the opportunity for the JV, Dinesh added that they have an aggressive revenue target. “I will say that our target is in three years time to be a Rs 15000 crore company in three years time from now. So we believe that considering the base we have, we can reach them, that’s not a problem.”
