PARIS -- PSA Group and Punch Powertrain said they will form a joint venture to produce electrified dual-clutch transmissions for 48-volt mild hybrid vehicles.
The new enterprise will be based at PSA's engine and transmission factory in Metz, eastern France. The plant will have an annual capacity of 600,000 transmissions when production starts in 2022.
PSA is beginning a major transition toward electrification, in line with CEO Carlos Tavares's plan to offer electrified variants across the entire lineup of the group’s five brands — Peugeot, Citroen, DS, Opel and Vauxhall — by 2025. The first new plug-in hybrids and battery-electric vehicles will appear in 2019.
Last year PSA signed a joint venture agreement with the Japanese supplier Nidec to design and produce electric motors, starting in 2022.
PSA has not yet announced which models will have 48-volt mild hybrid technology, which can offer emissions reductions of 10 percent or more, depending on how the technology is used. The automaker said the transmission to be produced with Punch will offer fuel savings of 15 percent and allow a zero-emissions mode for city driving.
Punch, which is based in Sint-Truiden, Belgium, had agreed to build transmissions for PSA last spring, but this week's announcement deepens their collaboration. The company started as a subsidiary of the automaker DAF and was later owned by ZF. It was bought by the Yinyi Group, a Chinese company, in 2016.
Last year Punch produced more than 1 million transmissions, mostly for Asian automakers. PSA is its first large European client.
A PSA Metz union official told Reuters that agreement with Punch would generate 400 jobs and said that PSA was investing 80 million euros in the joint venture. PSA did not confirm the figures.
The joint venture is subject to antitrust clearance and approval by employee councils.
Reuters contributed to this report