Tata Motors completes purchase of Ford India’s Sanand Plant

As we reported in May, Tata Motors has finally completed its bid to purchase Ford India’s plant in Sanand, in a deal worth ₹725.7 crore. The plant will give Tata a considerable boost in manufacturing capability as well as provide continued employment to existing Ford employees who work in the plant. The deal includes the entirety of the land, buildings, machinery and tooling, and what Tata has called “eligible employees”.

In an interesting move, Ford will continue to build powertrains and engines at its Powertrain Manufacturing Facility by leasing the site from Tata for the time being. According to agreed terms, Tata will absorb all employees if Ford decides to stop powertrain production. It is speculated that the move may be for export purposes, although whether Tata will invest in the engine technology is not clear.

The new Sanand manufacturing plant gives Tata the ability to produce 300,000 units per annum, which can be increased in scale to 420,000 units if required. As we have reported earlier, Tata is planning a huge move into the EV space, and this increased production capability will surely come in handy when it makes its move. The factory is also located close to Tata’s existing manufacturing facility in Sanand, which became famous for being the hub of production of the Nano.

Speaking about the deal, Shailesh Chandra, the Managing Director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility, said, “The agreement with FIPL signed today is beneficial to all stakeholders and reflects Tata Motors strong aspiration to further strengthen its market position in the Passenger Vehicles segment and to continue to build on its leadership position in the Electric Vehicle segment. It will accelerate the growth and development of the Indian auto industry by taking a progressive step forward towards building a future-ready Atmanirbhar Bharat”.