Tata Motors has said the acquisition of Ford India’s manufacturing plant at Sanand through its subsidiary will be completed on January 10, 2023.
“With existing capacities near saturation, this acquisition will unlock an additional state-of-the-art manufacturing capacity of 3,00,000 units per annum which is scalable to 4,20,000 units per annum,” the company said.
Additionally, TPEML has extended an employment offer to all qualified Ford India Private Limited employees on terms, and conditions. The employees will continue to enjoy the comparable benefits of service.
Earlier in August, Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of Tata Motors, and Ford India Private Limited (FIPL), has signed a Unit Transfer Agreement (UTA) for the acquisition of FIPL’s manufacturing plant situated at Sanand, Gujarat, which inter-alia includes:
(i) entire land & buildings.
(ii) Vehicle Manufacturing Plant along with machinery and equipment situated therein.
(iii) transfer of all eligible employees of FIPL’s vehicle manufacturing operations at Sanand, for a total consideration, exclusive of taxes, of Rs 725.7 crore.
Previously, Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of Tata Motors Ltd, and Ford India Private Limited (FIPL) signed a Memorandum of Understanding (MOU) with the Government of Gujarat (GoG) for the potential acquisition of FIPL’s Sanand vehicle manufacturing facility.
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.
This growth momentum is expected to continue with the strong pipeline of future-ready products and our proactive investments in Electric Vehicles. 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 in 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. The company anticipates this to take a few months.
This unit is adjacent to the existing manufacturing facility of Tata Motors Passenger Vehicles Ltd at Sanand, which should help in a smooth transition.
The government of Gujarat, TPEML, and FIPL have already executed a tripartite MoU on 30th May 2022 to support all relevant approvals for the above transaction.