Daikin and Rechi Precision join forces for compressor manufacturing in India

By Staff Report December 19, 2024 11:40 am IST

The partnership leverages Daikin India’s market leadership, deep industry expertise, sales network, and robust technical support, alongside Rechi Precision’s proven rotary compressor technology and manufacturing prowess.

Global leader in the HVAC industry, Daikin Industries Ltd., through its 100% subsidiary, Daikin Air Conditioning India Pvt. Ltd., and global leader in the compressor business, Rechi Precision Co. Ltd., Taiwan, disclosed the setup of a joint venture company to manufacture, design, and sell rotary (inverter & non-inverter) compressors in India and some overseas markets under a joint venture agreement (“JV Agreement”). Rechi Precision’s innovative rotary compressor technology complements Daikin India’s portfolio and delivers substantial benefits, including localised products, affordability, and enhanced reliability. The joint venture is expected to become operational by the 4th quarter of FY24~25. The manufacturing facility shall be established at Sri City, Andhra Pradesh.

This JV agreement leverages Daikin India’s market leadership, deep industry expertise, sales network, and robust technical support alongside Rechi Precision’s proven rotary compressor technology & manufacturing prowess. Together, they will provide residential customers with cost-effective air conditioners and support the high cooling demand. This collaboration plays a pivotal role in accelerating the shift towards AC adoption by the rising middle class, meeting both affordability & availability, relevant for India & overseas consumption. 

 Under this JV agreement, a joint venture will be established in India with Daikin India holding a majority share. In the initial phase of the partnership, efforts will concentrate on providing test samples of Rechi Group Taiwan’s rotary compressors (both inverter and noninverter) to India’s AC manufacturers to facilitate swift adoption and evaluation. 

“This partnership marks a significant milestone in broadening Daikin India’s offerings, enabling us to deliver a wider array of advanced rotary compressor technologies tailored for residential HVAC solutions,” said KJ Jawa, Chairman & Managing Director of Daikin India. “As the market witnesses growing demand for cost-effective air conditioners, our extensive sales network, customer-centric approach, strong brand reputation, and reliable after-sales support—combined with Rechi Precision’s innovative rotary compressor expertise—will empower us to provide economical and efficient air-conditioning options for our valued customers.”

“This JV formation is in line with our mid-term business strategy to establish a major hub in India. By partnering with Rechi Precision, a Taiwanese company known for its cost-effective material procurement and manufacturing expertise and extensive global track record in compressor sales, we aim to build a business foundation for compressor production and sales in India. Specifically, this new company will produce and sell compressors domestically to alleviate supply shortages and cater to both Daikin internal and external demand. As we expand our business, we will support the “Make in India” policy as a leading air conditioning company and contribute to the sustainable growth of the Indian market through stable supply. said Shoji Uehara, Executive Officer, Global Operations Division, Daikin Industries Limited, Japan

“In this joint venture, Rechi Precision will bring technical know-how, R&D, continuous product development, and production engineering capability and play a key role in setting up sales and service capability in India for Rotary Compressor. Advantages of JV: Localisation: The JV will augment manufacturing, designing, & sales of compressors in India and some overseas territories, especially as the demand for affordable, feature-rich products matures. Future Expansion Potential: The joint venture includes plans to build a new 33-acre manufacturing plant in Sri City, Andhra Pradesh, India, ensuring we meet growing customer demand and scale for future market shifts. Value-based & Affordable Solutions: As trends toward ACs accelerate, this agreement will provide customers with reliable, high-performance products and cost-competitive ACs to meet those needs. Confidential—Not for Public Consumption or Distribution Business. We are very excited to partner with Daikin and bring the latest technology in the field of rotary compressors to India.” said Chen, Shen Tien, Chairman of Sampo Corporation, Holding Company of Rechi Precision.