Stellantis rakes in eDCT-tech from Belgian Punch Powertrain

A Belgian judge’s decision in an appeal has officially secured Stellantis’ move to completely rake in the joint venture with Belgian Punch Powertrain in Sint Truiden. The French-Italo-American car giant takes complete control over the production and technology of crucial Dual Clutch Transmission (eDTC) components for its hybrid vehicles (mild hybrids and plug-in hybrids).

For Punch Powertrain, which developed the eDTC transmission years ago, the Punch Powertrain PSA E-Transmissions ­joint venture, which was to deliver components for up to 1.2 million hybrid transmissions per year, was a crucial lifeline for the future. Now uncertainty rules as Stellantis might transfer production to its own factories in Metz (France) or Turin (Italy).

Strategic transmissions

Stellantis wanted to control the entire production of these ‘strategic transmissions,’ so it pursued a takeover as the Chinese owner of Punch Powertrain, Yinyi/Sensteed Hi-Tech Group, failed to bring in enough new capital from ramping up production of the joint venture.

That way, the original majority share of Punch Powertrain in the JV diluted to 40%, while the original 39% of PSA became 60% for Stellantis by pumping in more money systematically. Ultimately, Stellantis used some clauses in the JV contract to make a hostile bid on the remaining shares and claim full ownership. It moved the JV’s seat to Brussels, where it has its own Belgian headquarters.

Going to court

Punch Powertrain, already wrestling with a debt of 494 million euros and a cumulated loss of 263 million, tried to fight this in court in appeal but apparently lost. Under the joint venture, 583 workers are concerned in Sint-Truiden and 81 in Eindhoven (the Netherlands). In addition to the JV, another 117 employees work for Punch Powertrain in Sint-Truiden.

Stellantis currently needs production in Sint Truiden, which means job security for 600 people in the short term. However, questions remain about the future as Stellantis is told to install similar production lines in its transmission factory in Metz.

Stellantis’s boss, Carlos Tavares, visited that factory a few weeks ago and thanked the employees for their progress in productivity. Tavares is known for his focus on internalizing the production of components as much as possible to control the entire chain of value of its products. In that light, easing off dependency on Chinese-owned (Belgian) technology looks like a logical, strategic decision.

Bumpy history

The history of the powertrain factory in Sint-Truiden reads as a bumpy ride with ups and downs. It started in 1972 as a subsidiary of Dutch then-carmaker DAF, manufacturing the first Variomatic, A CVT (Continue Variable Transmission) the brand was famous for. Owned by Volvo from 1975 to 1979, it was taken over by German ZF Getriebe.

In 2006, Belgian entrepreneur Guido Dumarey took over the company from ZF Getriebe (before VCST) and called it Punch Powertrain. In 2008, Dumarey had to sell it to other Belgian investors. In 2013, Chinese capital came in (New Horizon), and in 2016,  the company was sold for approximately one billion euros to the Chinese group Yinyi.

However, problems in the Chinese real estate market led to financial difficulties for Yinyi. A consortium of financially solid players like Fosun, Geely, and Haier came to the rescue, and a new economic entity was created: Yinyi became Sensteed, the current owner of Punch Powertrain.

 

 

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