Nissan Ends Three Indian Ventures with Ashok Leyland

Nissan Motor Co. has agreed to sell its stakes in three joint ventures with India’s Ashok Leyland Ltd. that were set up in 2008 to make light commercial vehicles, build powertrain components and conduct technology development.

Launched with a combined investment of about 10 billion rupees ($150 million), the ventures have struggled for profitability. Relations between the partners was strained earlier this year when Ashok Leyland accused Nissan of making cars with equipment intended for their truckmaking venture. The dispute escalated to a court fight over contract violations involving Renault Nissan Automotive India Pvt Ltd.

The Indian company owned 51% of the vehicle manufacturing venture (Ashok Leyland Nissan Vehicles Ltd.). Nissan held 51% of the powertrain business (Nissan Ashok Leyland Powertrain Ltd.), and the partners each held a 50% stake in the technology firm (Nissan Ashok Leyland Technologies Ltd.).

Ashok Leyland will absorb all three ventures as wholly owned subsidiaries, pending regulatory approvals. The company will continue to build several Nissan-based models for five years, paying the Japanese carmaker a 1% royalty fee.