Tata Motors inks MoU for potential acquisition of Ford’s Sanand plant

File shot of Ford’s plant in Sanand

Tata Passenger Electric Mobility, a subsidiary of Tata Motors and Ford India, have signed a Memorandum of Understanding (MoU) with the Gujarat state government for the potential acquisition of Ford’s Sanand vehicle manufacturing facility including Land and Buildings inside the vehicle manufacturing plant, machinery and equipment and transfer of all eligible employees of FIPL Sanand’s vehicle manufacturing operations. 

The MoU is subject to the signing of definitive agreements and receipt of relevant approvals. FIPL will operate its Powertrain manufacturing facilities by leasing back the land and buildings of the Powertrain unit from TPEML.

Tata Motor’s Passenger and Electric Vehicles have delivered market beating growth with its “New Forever” range of products over the last two years. With increasing capacity utilisations, sustaining this growth will require augmenting TML’s PV/EV manufacturing capacity in the coming years.

The Ford India vehicle manufacturing site at Sanand is a state-of-the-art site. TPEML would invest into new machinery and equipment which is necessary to commission and make the unit ready to produce its vehicles. With the proposed investments, it would establish an installed capacity of 300,000 units per annum, which would be scalable to more than 400,000 units. We anticipate this to take a few months. This MoU for a potential acquisition of this unit, is a win-win for all stakeholders and helps Tata Motors accelerate the enhancement of its PV/EV manufacturing capacity. This unit is adjacent to the existing manufacturing facility of Tata Motors Passenger Vehicles at Sanand, which should help in a smooth transition.

Announcing the signing of this MoU, Dr Rajiv Kumar Gupta, IAS, Additional Chief Secretary, Government of Gujarat, said, “This MoU is intended to catalyse 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.”

Speaking on the occasion, Shailesh Chandra, Managing Director, Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility said, “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 expansion of capacity, thus securing future growth and opportunity to further strengthen our position in the passenger and electric vehicles space.”