JSW, Skoda-Volkswagen India Stitch Up 51:49 JV Plan
JSW Group and Skoda-Volkswagen India sign a non-binding MoU for a 51:49 JV, with a binding deal targeted by end-2026.
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JSW Group and Skoda Auto Volkswagen India have signed a non-binding memorandum of understanding to explore a 51:49 passenger vehicle joint venture, with JSW Group holding the majority stake, and have begun exclusive valuation talks. A binding agreement is targeted by the end of 2026.
The proposed venture would cover the eight Skoda and Volkswagen brands currently sold in India, along with future rollouts including electric vehicles, and could involve capital commitments exceeding €1 billion. JSW has indicated it is open to bringing Volkswagen Group’s luxury marques into the venture in future.
Both sides are expected to finalise the equity structure, capital commitments, board control and manufacturing responsibilities before moving to definitive agreements, which will require regulatory approvals. JSW’s vehicle plant at Chhatrapati Sambhajinagar is being evaluated as a possible production site, alongside greater localisation of existing Skoda and Audi models. Skoda Auto Volkswagen India’s plants currently have a combined annual capacity of about 400,000 vehicles, against sales of around 100,000 units, with Volkswagen holding a 2.5 per cent share of India’s 4.6-million-unit car market.
A key factor in the valuation talks is Volkswagen’s potential tax liability in a customs-duty case, where authorities have alleged the company imported nearly complete vehicles in an unassembled state while declaring them as individual components to lower duties. The reported exposure is around Rs 20,000 crore, and JSW is understood to be unwilling to take on liabilities from the case, a factor that could affect the venture’s financial terms.
The talks followed a meeting between the Jindal family and Skoda Auto Chairman Klaus Zellmer, Volkswagen Passenger Cars CEO Thomas Schafer, and a Volkswagen Group board member at JSW’s Mumbai headquarters on August 17. Zellmer later said Volkswagen was open to ceding majority control to a local partner, without naming JSW.
JSW Group and Skoda Auto Volkswagen India have signed a non-binding memorandum of understanding to explore a 51:49 passenger vehicle joint venture, with JSW Group holding the majority stake, and have begun exclusive valuation talks. A binding agreement is targeted by the end of 2026.
The proposed venture would cover the eight Skoda and Volkswagen brands currently sold in India, along with future rollouts including electric vehicles, and could involve capital commitments exceeding €1 billion. JSW has indicated it is open to bringing Volkswagen Group’s luxury marques into the venture in future.
Both sides are expected to finalise the equity structure, capital commitments, board control and manufacturing responsibilities before moving to definitive agreements, which will require regulatory approvals. JSW’s vehicle plant at Chhatrapati Sambhajinagar is being evaluated as a possible production site, alongside greater localisation of existing Skoda and Audi models. Skoda Auto Volkswagen India’s plants currently have a combined annual capacity of about 400,000 vehicles, against sales of around 100,000 units, with Volkswagen holding a 2.5 per cent share of India’s 4.6-million-unit car market.
