business news

Tata Motors to acquire Ford India's Sanand plant in EV push

Tata Motors to acquire Ford India's Sanand plant in EV push

Indian carmaker, Tata Motors Ltd, has reportedly signed a MoU to acquire Ford India Pvt Ltd's manufacturing facility in Gujarat. The deal comes as part of the company’s bid to scale up the production of electric vehicles.

As per the regulatory filing, Tata Passenger Electric Mobility Ltd (TPEML), the EV affiliate of Tata Motors, has signed an MoU with Ford and the Gujarat government to potentially buy Ford’s manufacturing plant, including the latter’s assets such as the land and eligible employees.

Ford, the parent company of Jaguar Land Rover is already dominating India’s upcoming EV sector, which the Indian government is also trying to further grow by offering firms billions of dollars though incentives.

Tata stated that it will be investing in new equipment and machinery at the facility with the help of its electric mobility unit, and believes it would have an annual production capacity of 300,000 units after completion, which can later be raised to over 400,000 units.

Shailesh Chandra, Managing Director of TPEML, stated that with increasing customer preference for vehicles made by Tata Motors, the firm seen a multi-fold growth in recent times. Chandra added that this potential transaction will help in expanding the firm’s capacity.

Last year, Tata raised $1 billion for its electric vehicle business, competing with its long-time rival, Mahindra and Mahindra, which is one of the largest vehicle manufacturers in India.

The decision to acquire the Sanand facility comes following the American carmaker’s decision to halt production in India last year. The company called it quits after having a hold of less than 2% of the country’s total passenger vehicle market share and struggling to turn in profit over twenty years.

Earlier in May, Ford had stated that it was looking for options for its two plants in India, after having dropped the plans to make EVs in the country for export.

In another statement, the government of Gujarat claimed that the proposed acquisition of the Sanand plant by Tata Motors will solve the issue of potential job losses following the plant’s closure by Ford.

Source credit:

About the author

Omkar Patwardhan

Omkar Patwardhan started his professional career in the hospitality industry. Having nurtured a deep-sated passion for words however, he found his way into content writing and now pens down articles for numerous websites, including News Origins, spanning the sectors of business, finance, and technology.