Tata Motors to acquire Ford India’s Gujarat plant for Rs 725 crore, check details

Tata Motors has announced that it is acquiring Ford India’s manufacturing plant situated at Sanand, Gujarat. The deal between the automakers include entire land and buildings, vehicle manufacturing plant along with machinery and equipment situated therein and transfer of all eligible employees. For the acquisition, Tata Motors will pay Rs 725.7 crore to Ford India Private Limited (excluding taxes). Ford will continue to operate its Powertrain Manufacturing Facility by leasing back the land and buildings of the Powertrain Manufacturing Plant from TPEML on mutually agreed terms. TPEML has agreed to offer employment to the eligible employees of FIPL’s Powertrain Manufacturing Plant in the event of FIPL’s cessation of such operations.

The closure of the transaction will be subject to the receipt of relevant approvals from the government authorities and fulfilment of customary condition precedents. 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. 

Tata Motors Passenger Vehicles business has delivered market-beating growth over the last few years and has strong plans to sustain this momentum, with its robust pipeline of future ready “New Forever” products and proactive investments in electric vehicles. With manufacturing capacity nearing saturation, this acquisition is timely and a win-win for all stakeholders. It will unlock a state-of-the-art manufacturing capacity of 300,000 units per annum which is scalable to 420,000 units per annum.

TPEML would make the necessary investments to reconfigure the plant to adapt to Tata Motors' existing and future vehicle platforms. The unit is adjacent to the existing manufacturing facility of Tata Motors Passenger Vehicles Limited at Sanand, which should help in a smooth transition.