PSA Group Creates Joint Venture With Japan’s Nidec Corp, To Invest €200 Million To Bring Electric Drivetrain/Motor Development & Production Back To France

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PSA Group has established a new joint venture with the Japan-based firm Nidec Corp that will be focused on bringing electric drivetrain (motor) development and production back to France.

The initial investment into the joint venture will total some €200 million ($237 million) — with the plan being for the joint venture to equip all electrified Peugeot, Citroen, DS, Opel, and Vauxhall models onwards from 2022. Until 2022, Germany’s Continental along with the Valeo-Siemens Automotive joint venture will be equipping PSA Group electric vehicles (from 2019–2022, that is).

This announcement follows a few years after Renault’s decision to do the same — that is, to bring electric drivetrain/motor production back to France. There’s a very good reason behind these decisions — all-electric vehicles are very simple mechanically, with the only primary parts being the drivetrain/motor and the battery pack (PSA Group is almost definitely going to be sourcing its batteries from an outside supplier), so if the company wants to make money on them, it likely should be manufacturing the drivetrain/motor itself.

“Through this partnership, the goal is to move to a strategic phase that gives us more control,” commented Patrice Lucas, PSA’s executive vice president for strategy.

Reuters provides more: “The PSA-Nidec venture is expected to have a production capacity of 900,000 motors per year from 2022, he said. The market for electric vehicle motors is expected to double to €45 billion ($53 billion) over the next 2 decades, the companies said in a statement, as the industry undergoes profound change, with consumers increasingly demanding alternatives to combustion engines.

“Nidec will operate the joint venture through Nidec Leroy-Somer, the French electric motor company it acquired in February this year for $1.2 billion. Tetsuo Onishi, executive vice president for Nidec, said that the capital structure of the joint venture would remain split 50–50 once production began but that Nidec would take control of sales.”

The plan is for PSA Group to be the joint venture’s primary customer, but for business with other auto manufacturers to remain open. The headquarters for the joint venture will be located in Carrieres-sous-Poissy near Paris (at PSA Group’s Diesel engine plant there).

Nidec, it’s worth remembering, owns the US Motors brand and has acquired a number of prominent firms in recent times, including the automotive electronic control unit designer driveXpert. The company’s plan, reportedly, is to become a top auto parts supplier for the transforming industry over the coming years.

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James Ayre

James Ayre's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy.

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