Tata Motors to acquire Ford’s Sanand plant; signs MoU with Gujarat govt

Tata Motors’ subsidiary Tata Passenger Electric Mobility Limited (TPEML) and Ford India Private Limited (FIPL) have signed a Memorandum of Understanding (MoU) with the Government of Gujarat for the potential acquisition of the latter’s Sanand vehicle manufacturing facility. The definitive transaction agreement between Tata and Ford will be signed in the next few weeks.

The deal would include the land and buildings, the vehicle manufacturing plant, machinery and equipment, and transfer of all eligible employees of the Sanand plant’s manufacturing operations. The deal is subject to signing of definitive agreements and relevant approvals. The statement by Tata Motors added that Ford will operate its Powertrain manufacturing facilities by leasing back the land and buildings of the Powertrain unit from TPEML

The Ford plant in Sanand is a state-of-the-art site, located adjacent to the Tata Motors Passenger Vehicles manufacturing facility. Tata Motors will invest in new machinery and equipment required to make the unit ready to produce its vehicles. Following the investments, the plant would have a capacity of 300,000 units per annum, scalable to more than 400,000 units. 

Tata stated that they expect this to take a few months. The plan will accelerate the enhancement of its PV/EV manufacturing capacity. 

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.”

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 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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