Valeo and South Korean partner, PHC have obtained regulatory approvals to create a joint venture in torque converters for automatic and continuous variable transmissions.

The company will employ around 3,150 people and will be controlled and fully consolidated by Valeo. It is forecast to generate sales of around EUR1bn (US$1.191bn) on an annual basis and will be accretive to Valeo's operating margin from its first fiscal year.

Valeo-Kapec will capitalise on the two partners' geographic, product and business complementarity to create purchasing, manufacturing and, above all, R&D synergies.

"By strengthening our ties with our long-standing South Korean partner and creating this joint venture, we will double our sales of torque converters for automatic and continuous variable transmissions and become the world leader in this high-technology product line," said Valeo chairman and CEO, Jacques Aschenbroich.

"And by stepping up our presence in South Korea and increasing sales to Hyundai-Kia, we expect our sales in Asia to increase by around EUR500m."

Auto market intelligence
from just-auto

• Auto component fitment forecasts
• OEM & tier 1 profiles & factory finder
• Analysis of 30+ auto technologies & more