Valmet Automotive enters new era: Finland takes majority control as China’s CATL exits; eyes defence sector expansion

Finland’s Valmet Automotive announces changes to its ownership and business structure, including adjustments to its subsidiaries.

China’s Contemporary Amperex Technology (CATL), an electric vehicle battery maker, has sold its stake in Finnish subcontract car manufacturer Valmet Automotive.

As part of a broader ownership and financing arrangement, the Finnish State has emerged as the new majority owner of Valmet Automotive, taking a 79 per cent stake. Finnish investment company Pontos Group retains a 21 per cent share. 

The deal underscores Finland’s determination to secure domestic industrial capabilities at a time of shifting geopolitical dynamics and ongoing restructuring in the European automotive industry.

Valmet Automotive’s ownership moves from Finnish Industry Investment Ltd (Tesi) to direct state ownership. The State and Pontos will also invest €37.5M of new capital into Valmet Automotive.

Valmet Automotive CEO, Pasi Rannus, says, “We are taking a completely new step in Valmet Automotive’s sixty-year history, as we are expanding the company’s business beyond car manufacturing. Our expertise in industrial serial production, unique in Finnish conditions, creates a strong foundation for this expansion.”

“This will add new pillars to our business and, on the other hand, create more domestic production capacity in Finland, for example, for the needs of the defence sector and security of supply. I am particularly pleased that the special expertise in industrial serial production will now remain in Finland.”

Separation of the battery business

As part of the same arrangement, Valmet Automotive’s battery systems subsidiary IONCOR, becomes a subsidiary of Finnish Minerals Group, which develops Finland’s battery value chain.

IONCOR will be owned by Finnish Minerals Group (70 per cent), Varma Mutual Pension Insurance Company (16 per cent), and Pontos Group (14 per cent). The State will invest €20M of new capital into IONCOR.

Pasi Rannus mentions, “IONCOR is one of Europe’s leading independent manufacturers of automotive battery systems, and thus a key player in the clean energy transition. Now, the company becomes an integral part of the Finnish battery value chain and, with new owners, gains even stronger support for developing its operations.”

IONCOR develops battery systems for transport, heavy vehicles, and off-highway machinery. It was created when Valmet Automotive reorganised its operations into three separate business areas: IONCOR for battery systems, RKS for roof and kinematic systems in Poland and Germany, and the parent company’s contract manufacturing business in Finland.

Kari Heinistö, Chairman of Valmet Automotive’s Board of Directors, says, “We are very pleased with the ownership and financing arrangement that has now been established. Valmet Automotive’s strategic expansion is now made possible, and with its new owners, IONCOR will have an excellent opportunity to develop its business as part of the Finnish battery value chain.”

Strategic expansion

The state-backed restructuring comes against a backdrop of continued downturn in Europe’s automotive industry and slower-than-expected electrification of transport. 

Valmet Automotive plans to diversify its contract manufacturing business into new industries, including the defence sector, where its expertise in large-scale, high-precision production is expected to support Finland’s security of supply.

CATL’s exit from Valmet Automotive reflects a broader recalibration of the company’s European partnerships as demand for electric vehicles cools. However, IONCOR’s integration into Finland’s state-owned battery value chain highlights the Nordic country’s strategic bet on energy independence and green technology.

Brief about Valmet Automotive

Valmet Automotive is a vehicle contract manufacturer and a European producer of convertible roof and kinematic systems, including electric vehicle charging flaps and active spoilers.

The company was founded in 1968 in Finland and has produced 1.9 million vehicles at its Uusikaupunki plant. Vehicle contract manufacturing is based in Finland, while roof and kinematic systems operations are located in Poland and Germany.