Magna Enters Micromobility Market: Investing in Yulu and Creating Battery-Swapping Business

Rhea-AI Summary

Magna is making a strategic move into the micromobility market by investing $77 million in Yulu, India's top electrified shared mobility provider. This investment is expected to enhance sustainable urban mobility in India through a new battery-swapping service company, Yulu Energy. Magna will gain a stake in Yulu and a board seat. The partnership aims to capitalize on the growing demand for electric two-wheelers, with Yulu planning to expand operations to 15 additional cities within 18 months, further advancing Mobility-as-a-Service (MaaS) and Battery-as-a-Service (BaaS).

Positive

• Investment of $77 million into Yulu positions Magna in the rapidly growing micromobility sector.
• Creation of Yulu Energy enhances Magna’s Battery-as-a-Service capabilities.
• Collaboration allows for expansion into sustainable urban mobility in India.
• Yulu's existing operations with 10,000 electric two-wheelers provide a strong market foundation.

Negative

• None.

• $77 million investment opens door to fast-growing micromobility market
• Battery-swapping service unlocks new business model for Magna
• Opportunity to advance sustainable urban mobility in India

AURORA, Ontario, Sept. 11, 2022 (GLOBE NEWSWIRE) -- Mobility technology company Magna is expanding into the fast-growing micromobility market by investing $77 million in Yulu, India’s largest electrified shared mobility provider, and creating a battery-swapping service company.

Yulu deploys shareable, low-speed, electric two-wheelers to facilitate accessible, sustainable urban mobility in India. As part of the agreement, Magna will have a stake in the company and will hold a seat on Yulu’s board of directors. In addition, the two companies have established a new battery swapping entity to support the rapid growth in electrification of mobility and required infrastructure.  

“This is an incredibly exciting time for Magna to contribute to a sustainable future in urban mobility through this investment in Yulu,” said Matteo Del Sorbo, Executive Vice President, Magna International and Global Lead for Magna New Mobility. “Micromobility presents a great opportunity for additional growth for Magna, and joining forces with Yulu helps us expand our business into this rapidly growing sector.”

Magna brings extensive capabilities in design, engineering and manufacturing to this new entity, currently registered as “Yulu Energy”. With its proven track record of operating in high volume production globally, Magna will serve as the exclusive battery-swapping provider for Yulu’s customers and manage the future buildup of the infrastructure required for millions of swaps per week.

This new Battery-as-a-Service (BaaS) entity leverages Yulu’s strong market position and network in India as well as its software expertise. The company currently has approximately 10,000 electric powered two-wheelers in service and operations in Bangalore, Delhi, and Mumbai. Yulu is targeting an additional 15 cities in the next 18 months, with potential to expand beyond India in the future.

Amit Gupta, Co-founder & CEO, Yulu said, “We can clearly see a significant growth opportunity for Yulu in both the BaaS and MaaS businesses in the next three to four years. As the market leader in electric mobility, with a proven business model built on positive unit economics, our focus now will be to establish a robust and agile supply chain and scale-up our operations. We will go deeper and denser in our existing markets and explore new areas while delivering a great customer experience. We welcome Magna onboard with our shared vision to create a sustainable and scalable EV ecosystem in India and beyond.”

Yulu Energy has approximately 200 employees and it is headquartered in Bangalore, India.

Magna’s entry into one of the fastest growing markets for an electrified two-wheel mobility platform aligns with its core competencies and Go-Forward strategy to expand in Mobility-as-a-Service (MaaS) and Battery-as-a-Service (BaaS) businesses.

TAGS
Micromobility, electric powered two-wheelers, electric scooters, Yulu Mobility

INVESTOR CONTACT
Louis Tonelli, Vice-President, Investor Relations
louis.tonelli@magna.com, 905.726.7035

MEDIA CONTACT
Tracy Fuerst, Vice President, Corporate Communications & PR
tracy.fuerst@magna.com, 248.761.7004

ABOUT MAGNA
Magna is more than one of the world’s largest suppliers in the automotive space. We are a mobility technology company with a global, entrepreneurial-minded team of 161,000 employees and an organizational structure designed to innovate like a startup. With 65+ years of expertise, and a systems approach to design, engineering and manufacturing that touches nearly every aspect of the vehicle, we are positioned to support advancing mobility in a transforming industry. Our global network includes 341 manufacturing operations and 89 product development, engineering and sales centres spanning 28 countries.

For further information about Magna [(NYSE:MGA; TSX:MG)], please visit www.magna.com or follow us on Twitter @MagnaInt.

THIS RELEASE MAY CONTAIN STATEMENTS WHICH CONSTITUTE “FORWARD-LOOKING STATEMENTS” UNDER APPLICABLE SECURITIES LEGISLATION AND ARE SUBJECT TO, AND EXPRESSLY QUALIFIED BY, THE CAUTIONARY DISCLAIMERS THAT ARE SET OUT IN MAGNA’S REGULATORY FILINGS. PLEASE REFER TO MAGNA’S MOST CURRENT MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL POSITION, ANNUAL INFORMATION FORM AND ANNUAL REPORT ON FORM 40-F, AS REPLACED OR UPDATED BY ANY OF MAGNA’S SUBSEQUENT REGULATORY FILINGS, WHICH SET OUT THE CAUTIONARY DISCLAIMERS, INCLUDING THE RISK FACTORS THAT COULD CAUSE ACTUAL EVENTS TO DIFFER MATERIALLY FROM THOSE INDICATED BY SUCH FORWARD-LOOKING STATEMENTS. THESE DOCUMENTS ARE AVAILABLE FOR REVIEW ON MAGNA’S WEBSITE AT WWW.MAGNA.COM.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/66397e89-af56-4539-9685-6511af667fef

FAQ

What is Magna's recent investment related to Yulu?

Magna has invested $77 million in Yulu, India's largest electrified shared mobility provider, to expand into the micromobility market.

How will Magna benefit from its investment in Yulu?

Magna will gain a stake in Yulu, a seat on its board, and enhance its Battery-as-a-Service business through the establishment of Yulu Energy.

What are Yulu's plans after Magna's investment?

Yulu aims to expand its operations to 15 additional cities in India within the next 18 months.

What does the partnership mean for urban mobility in India?

The partnership is expected to advance sustainable urban mobility solutions in India with innovative battery-swapping services.

What market does Magna target with this investment?

Magna is targeting the fast-growing micromobility market, focusing on electric two-wheelers.