Eicher Motors Limited and Volvo Group have announced an intent to form a 50:50 joint venture to provide financing, leasing and other financial services in India. The board of Eicher Motors has approved an investment of up to Rs 7.5 bn to subscribe to a 50 per cent equity stake in Volvo Financial Services (VFS) India. The new entity is intended to act as a captive financier for Eicher, Volvo and related businesses.

Eicher Motors maintains a long-standing partnership with Volvo Group through their joint venture, VE Commercial Vehicles Limited, and the proposed arrangement is designed to align financing more closely with product sales. The joint venture will serve as the captive financing arm for vehicles and related products, supporting dealers and customers with tailored finance solutions. The companies expect the structure to strengthen distribution and after-sales financing capabilities.

The chairman of Eicher Motors explained that the move expands an 18-year collaboration with Volvo Group and brings together Volvo’s global financial services expertise with Eicher’s local market knowledge and network. He indicated the joint venture will serve Eicher, Volvo and Royal Enfield customers in India and will allow Eicher to operate in an important segment of the value chain. The firm suggested financing will be used as a lever to improve customer experience and accelerate business growth.

VFS is the Volvo Group’s captive finance provider and reported assets under management of about USD 27.4 bn globally. VFS India has operated for more than a decade and reported assets under management of Rs 18.25 bn as of 31 March 2026. The transaction remains subject to regulatory approvals and the final investment amount will be determined at closing when fresh equity shares are issued to Eicher Motors.