• Friday, March 29, 2024

Business

Tata Motors to buy Ford India’s Gujarat manufacturing plant For £75.3m

By: Shubham Ghosh

Major Indian automaker Tata Motors is set to buy a Ford manufacturing unit in the western Indian state of Gujarat for Rs 7.26 billion (£75.3 million).

The deal comes as the Indian carmaker plans to boost its vehicle-production capacity to meet rising demand. Tata saw a massive jump in its car sales in the month of July — selling 47,505 units which is a 57 per cent rise from that recorded in July 2021.

The latest deal between Tata’s electric vehicle subsidiary and Ford’s Indian unit covers land, machinery and all “eligible employees”,

The deal comes as Tata moves to boost its car production to meet demand.

The deal between Tata’s electric vehicle subsidiary Tata Passenger Electric Mobility Limited and Ford India Private Limited, the US car maker’s Indian unit covers land, machinery and all “eligible employees”.

Ford halted its production in India in 2021 after struggling to generate profits in the South Asian nation for more than two decades.

“With our manufacturing capacity nearing saturation, this acquisition is timely and a win-win for all stakeholders,” Tata Motors said in a statement.

Tata Motors, which owns the UK’s Jaguar Land Rover, said that annual production at the Sanand plant in Gujarat will initially give it a new capacity to produce 300,000 vehicles a year, which could be later raised to 420,000.

Tata Motors bought Jaguar and Land Rover from Ford in 2008 and merged the UK’s luxury car brands into one company.

The announcement marked a key step forward in Ford’s plans to restructure its Indian business, Ford transformation officer Steve Armstrong said, BBC reported.

In September 2021, Ford said it would close down its Indian car factories as part of a move that would cost around $2 billion (£1.65 billion). It also said that about 4,000 workers would be impacted by the decision.

Ford’s operations in India had seen losses worth $2 billion in the last decade.

Some of India’s domestic carmakers have seen a rise in demand. Mahindra & Mahindra, another major Indian automaker, said on Friday (5) that demand for its vehicles outstripped production as people queued up to buy its popular sport-utility vehicles.

Related Stories

Loading