Volvo Financial Services (VFS) and Eicher Motors Limited have announced their intent to form a 50:50 joint venture to provide financing, leasing and other financial services for customers of Volvo and Eicher-branded commercial vehicles in the Indian market. Pending regulatory approval, the JV will be created through VFS India issuing new shares to Eicher in exchange for an equity investment of up to Rs. 750 crore, or approximately SEK 730 million. The exact investment amount will be determined at the time of closing, as per the transaction documents. The impact on earnings at the close of the transaction is expected to be insignificant and will not have any cash flow impact on the Volvo Group.
“VFS has developed a strong portfolio in India by leveraging our global presence and working hand in hand with our Volvo customers and dealers,” said Marcio Pedroso, President, VFS. “We believe now is the time to sharpen our focus on the Eicher brand as well, with our intended partnership serving as a springboard for bringing innovative financial services and solutions to both existing and new customers and dealers, positioning us well to create long-term value in the growing Indian market.”
As the captive finance arm of the Volvo Group, VFS has a deep understanding of customers’ operations, enabling it to offer tailored financial and insurance solutions and services.
With its strong portfolio of truck and bus models, Eicher is a leading manufacturer of transport solutions, supported by an extensive dealer network across India.
The proposed JV will combine VFS’ expertise and customer-centric approach with Eicher’s commercial vehicle portfolio and dealer network to capture new business opportunities in a more aligned and efficient manner. The JV is also expected to deepen integration between the two companies, bringing them closer to customers and accelerating decision-making, thereby enabling easier access to financing solutions tailored to business requirements.
The Volvo Group and Eicher share nearly two decades of successful collaboration through VE Commercial Vehicles (VECV), which was formed in 2008. Today, VECV offers a comprehensive range of modern and efficient trucks and buses that can be financed through VFS.
Initially, the proposed JV will focus on financing Volvo and Eicher commercial vehicle products, with the possibility of extending financing support to Royal Enfield customers and dealers in India in the future.
VFS and Eicher intend to operate the proposed JV as an independent entity, integrating existing people, resources and assets from both organisations into the new company. Following the integration, no changes are expected to the current office locations of VFS India, which include Gurgaon, Bengaluru, Kolkata, Mumbai, Hyderabad and Delhi.
The transaction is expected to close during the first half of 2027, subject to approvals from the relevant authorities.
