Tata Motors Signs MoU For Acquiring Ford India’s Sanand Plant

Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of Tata Motors, and Ford India Private Limited signed a Memorandum of Understanding (MoU) today with the Government of Gujarat for the potential acquisition of the Ford Sanand plant. This will include the acquisition of land and buildings, vehicle manufacturing plant, machinery, and equipment as well as the transfer of all eligible employees working at the Sanand facility. Ford will operate its powertrain manufacturing facilities by leasing back the land and buildings of the powertrain unit from TPEML.

Announcing the signing of this MoU, Dr. Rajiv Kumar Gupta, IAS, Additional Chief Secretary, Government of Gujarat, said, “This MoU is intended to catalyze a win-win for all the stakeholders and ensure a smooth transition. This effort reinforces Gujarat’s image as a progressive, investment-friendly state and its resolve to further strengthen the state as a leading automotive hub in the country. It will boost the confidence of the international investment community, reinforce Gujarat’s position as the top investment destination in the country and further strengthen the Atmanirbhar vision of our Hon’ble Prime Minister.”

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Tata Motor’s ‘New Forever’ product lineup is said to have grown quite exponentially within the Indian markets. And their strong pipeline of future-ready products and proactive investments in electric vehicles is expected to take this momentum to even greater heights ahead. In order to sustain this growth, the brand would be requiring an augment in its manufacturing capacity.

Speaking on the occasion, Mr. Shailesh Chandra, Managing Director, Tata Motors Passenger Vehicles Limited and Tata Passenger Electric Mobility Limited, said, “Tata Motors has a strong presence in Gujarat for more than a decade with its own manufacturing facility at Sanand. This MoU further reinforces our commitment to the state by creating more employment and business opportunities. Rising customer preference for passenger and electric vehicles made by Tata Motors has led to a multi-fold growth for the company over the past few years. This potential transaction will support the expansion of capacity, thus securing future growth and opportunity to further strengthen our position in the passenger and electric vehicles space.”

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Ford India’s Sanand manufacturing plant is a state-of-the-art facility. TPEML would, however, need to invest in new machinery and equipment to get the site up and running. The automaker will be establishing an installed capacity of 300,000 units per annum, scalable to more than 400,000 units, with the proposed investments. The MoU for the acquisition of this unit creates a win-win situation for all the stakeholders. The facility is adjacent to Tata Motors’ Sanand passenger vehicles manufacturing unit in Gujarat. It will help the brand accelerate its production of both the standard passenger and electric vehicles in the country. 

The MoU will be followed by the signing of definitive transaction agreements between TPEML and FIPL over the next few weeks.      

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