Finance
Engine Maker Horse Plans India Move to Supply Growing Small Car Market, CEO Says
Published by Global Banking & Finance Review®
Posted on April 25, 2026
2 min readLast updated: April 25, 2026
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Horse Powertrain, the Renault–Geely joint venture established in May 2024, is preparing to enter India’s small car segment following New Delhi’s GST cut—from 28% to 18%—on sub‑4m, ≤1.2 L vehicles, aiming to eventually manufacture locally and tap export potential.
Engine maker Horse plans India move to supply growing small car market, CEO says
Horse Powertrain Eyes Indian Expansion Amid Rising Demand for Small Car Engines
(Corrects headquarters in paragraph 4 to London, not Madrid)
By Rachel More
Regulatory Changes Boost Small Car Market in India
BEIJING, April 25 (Reuters) - Engine maker Horse Powertrain is laying the groundwork for a manufacturing presence in India after regulatory changes in the world's third-largest car market boosted demand for compact vehicles, the company's CEO told Reuters.
Prime Minister Narendra Modi's government slashed India's federal sales tax on small cars to 18% from 28% in September. This includes gasoline cars measuring less than 4 meters in length, with an engine capacity of 1.2 litres or below.
Industry Response to Tax Cuts
"Everybody's rushing now and saying, 'We need a 1.2 litre efficient engine.' That's where we can help," Chief Executive Matias Giannini said, speaking on the sidelines of the Beijing auto show, which opened to the media on Friday.
About Horse Powertrain
London-headquartered Horse, formed in 2024 out of the carved-out combustion engine operations of French carmaker Renault and China's Geely, supplies fossil-fuel engines and hybrid systems to carmakers looking to streamline their operations in the transition towards EVs.
Plans for Indian Market Entry
HAS FILED TO SET UP OWN LEGAL INDIA ENTITY
Horse has filed to set up its own entity in India, Giannini said. The company hopes for a positive outcome some time in the third quarter of this year.
Steps Toward Local Manufacturing
"The most likely first steps would be a combination of partnership and importing from other Horse locations, then stepping into local manufacturing," Giannini said, adding that the goal was to supply to the Indian market but also export from there to other markets.
Global Operations and Client Base
The firm operates 18 plants and five research and development centres across Europe, China and Latin America, most recently establishing a presence in the U.S.
Its customers include owners Renault and Geely as well as Volvo, Mercedes-Benz and Nissan.
Future Prospects and Industry Partnerships
Giannini said the company was in talks with all top-tier carmakers and that he hoped these would advance in some cases towards "some big contracts". He did not give further details.
(Reporting by Rachel More; additional reporting by Aditi Shah in New Delhi; Editing by David Dolan and Edwina Gibbs)
Key Takeaways
- •Horse Powertrain was created in May 2024 as a joint venture between Renault and Geely, with 19,000 employees, 17 plants and €15 billion expected annual revenue (media.renaultgroup.com)
- •India’s GST on small cars (under 4 meters and ≤1.2 L) was cut to 18% from 28%, significantly boosting demand in that segment (autocarindia.com)
- •Horse has filed to create its own legal entity in India, plans to start with partnerships and imports in Q3 2026, then move to local manufacturing and export (carnewschina.com)
References
- Renault Group and Geely announce the creation of leading Powertrain Technology Company, “HORSE Powertrain Limited” - Site media global de Renault Group
- GST On Small Cars May Be Cut From 28 Percent To 18 Percent: Report - Introduction | Autocar India
- Geely-backed Horse Powertrain reveals renewable hybrid engine, targets 40% lower fuel use
Frequently Asked Questions about Engine maker Horse plans India move to supply growing small car market, CEO says
1Why is Horse Powertrain planning a manufacturing presence in India?
Regulatory changes in India, including lower sales tax on small cars, have increased demand, prompting Horse Powertrain to consider manufacturing in India.
2What products will Horse Powertrain supply to the Indian market?
Horse Powertrain plans to supply 1.2 litre efficient engines and hybrid systems for small cars in India.
3Has Horse Powertrain already established a legal entity in India?
Horse Powertrain has filed to set up its own legal entity in India and hopes for a positive outcome in the third quarter of this year.
4Who are Horse Powertrain's main customers?
Horse Powertrain's customers include Renault, Geely, Volvo, Mercedes-Benz, and Nissan.
5What is the company's plan for entering the Indian market?
Horse Powertrain plans to begin with partnerships and importing, then move towards local manufacturing and exporting from India to other markets.
