Engine manufacturer Horse Powertrain is preparing to set up shop in India, betting on a surge in compact car demand triggered by recent tax reforms in the country, according to its chief executive, the Business Standard reported .
The Narendra Modi-led government cut the federal goods and services tax on small cars from 28 per cent to 18 per cent in September. The lower slab applies to petrol vehicles under four metres in length powered by engines of up to 1.2 litres.
That policy shift has sparked fresh interest among carmakers in smaller engines, which plays directly to Horse's strengths. "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 on the sidelines of the Beijing auto show, which opened to the media on Friday (24 April).
Headquartered in London, Horse was created in 2024 by carving out the internal combustion engine businesses of France's Renault and China's Geely.
The firm supplies petrol engines and hybrid powertrains to automakers seeking to rationalise operations as the industry shifts towards electric vehicles.
Giannini said Horse has already applied to register a legal entity in India and expects clearance some time during the third quarter this year.
"The most likely first steps would be a combination of partnership and importing from other Horse locations, then stepping into local manufacturing," he said, noting that India could eventually serve as an export hub alongside catering to domestic buyers.
Horse runs 18 factories and five R&D facilities spread across Europe, China and Latin America, having recently entered the US market. Beyond its parent companies Renault and Geely, its client roster features Volvo, Mercedes-Benz and Nissan.
Giannini added that discussions were underway with every major global automaker, with some potentially leading to "some big contracts", though he declined to elaborate.