The Tata Passenger Electric Mobility Limited subsidiary of Tata Motors Ltd has signed an agreement with Ford India Private Limited acquisition of its Sanand, Gujarat manufacturing plant for Rs 725.7 crore.
This Unit Transfer Agreement (UTA) covers the plot of land, all buildings, the vehicle manufacturing plant’s machinery and equipment, and the transfer of all qualified workers of FIPL’s Sanand vehicle manufacturing operations.
The Powertrain Manufacturing Plant’s land and structures will be leased back to Ford India by TPEML on mutually agreeable terms, allowing it to continue operating its Powertrain Manufacturing Facility. The announcement also stated that TPEML had pledged to extend job opportunities to the qualified workers of Ford India’s Powertrain Manufacturing Plant if Ford India private limited stopped conducting such operations. Ford Sanand plant can build 270,000 engines per year and 300,000 passenger cars per year.
Permits Need to be Followed between Ford India and Tata Motors to Close the Deal
The deal will only be finalised once all necessary approvals from the government agencies have been obtained, together with the fulfilment of typical prior condition precedents. To support the necessary clearances for the transaction, the Gujarati government, TPEML, and FIPL had already signed a tripartite MoU on May 30.
TPEML would make the necessary investments to adapt the manufacturing to fit the current and upcoming Tata Motors vehicle platforms. An easy transition should be made possible by the unit’s proximity to Tata Motors Passenger Vehicles Limited’s current Ford Sanand plant site.
Mr. Shailesh Chandra, Managing Director, Stated the Following about the Deal
The partnership with Ford India private limited will benefit all stakeholders, says Shailesh Chandra, Managing Director of Tata Motors Passenger Vehicles Limited and Tata Passenger Electric Mobility Limited. It demonstrates Tata Motors’ desire further to consolidate its market position in the Passenger Vehicles segment and build on its leadership position in Electric Vehicles.”
A progressive step toward creating an Atmanirbhar Bharat for the future will enhance the growth and development of the Indian car sector.
Ford India, the renowned American automaker whose creator Henry Ford revolutionised the sector at the turn of the 20th century, declared last year that it would stop producing cars in India due to mounting losses. Tata is anticipated to make the necessary investments to modify the factory to accommodate the current and following car platforms used by Tata Motors.