TVS to join electric vehicle lane with traction motors

Automotive electricals manufacturer Lucas TVS will launch traction motors designed for electric vehicles by next year in what the 55-year-old TVS Group company believes is a key de-risking strategy to align with the global transition towards electric vehicles.

The company will set up a trial production line dedicated to its EV journey inside one of its seven plants, with room to scale up, based on demand.

The plan is to expand in a phased manner. The traction motors will find purchase in the growing electric rickshaws and electric threewheeler segments.

Lucas TVS will evaluate product segments relevant for the EV industry as government regulations and incentives to encourage adoption of the cleaner technology evolve.

Having been working on the transition to electric-vehicle technology for four years now, the company views it as a threat to its existing businesses but also an opportunity to strike new ground.

Arvind Balaji, a fourth-generation scion of the TV Sundaram Iyengar family and the joint managing director at Lucas TVS, said that large automakers have made advances on building technology for e-vehicles, but the transition will be gradual.

With government regulations still being drafted, the dynamics between the original equipment maker and suppliers will become apparent only later.

"Everybody is working on the technology aspect of electric vehicles. What is still not clear is the roadmap. What is the government policy to promote EVs? What is the roadmap for charging infrastructure? What is the degree of localisation in manufacture of EVs? In India, as opposed to other countries where electric vehicles are driven by subsidies, economic value propositions will be key driver," Balaji told ET in an exclusive interview.

Though the roadmap is hazy, Balaji has already begun making changes to his business to suit the transition — from different capital models to judicious capacity expansions. There will be a focus on the non-automotive clientele like defence purchases.

Currently, the non-automotive businesses make up only 7% of the annual revenue.

"We started this de-risking four years ago. Traditionally, we make our sub-assemblies and components inhouse. In the future, we will look to buy these sub-components from suppliers and assemble in-house. We won't invest in huge capacities and wait for the market to arrive because such risks are unaffordable right now."

In the next three years, Lucas TVS will invest about ₹200 crore. Its investments will get routed more towards research and development, and enabling partnerships with technology institutions to create intellectual property.

Currently, it has tie-ups with electronics consulting firms and institutes in Germany to tackle control system problems. Research is also underway at IIT-Madras on keeping down electromagnetic noise emanating from its motors.

Analysts tracking the transition to electric vehicles are confident that there will be governmental push toward e-mobility adoption in the coming years.