Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of India’s largest car manufacturer Tata Motors, has signed a contract with Ford India to take over a Ford plant in Sanand in the Indian state of Gujarat. Tata plans to build electric cars there in the future.
The acquisition of the plant, which is still subject to approval by the relevant authorities, will provide Tata with the needed production capacity for 300,000 electric vehicles per year, which can later be scaled to 420,000 electric vehicles per year.
According to Tata Motors, Ford India Private Limited (FIPL) will continue to operate its powertrain manufacturing facility on the site. For this, this part of the plant will be leased back on mutually agreed terms. However, control of the vehicle plant will remain with TPEML.
“With our manufacturing capacity nearing saturation, this acquisition is timely and a win-win for all stakeholders,” Tata wrote in the statement. TPEML will make the necessary investments to reconfigure and adapt the plant to Tata Motors’ existing and future vehicle platforms, it added.
The acquisition will also play an important role in achieving its own electric vehicle production targets. At the end of April, Tata Motors had decided to more than quadruple its production of electric vehicles this fiscal year, according to a media report. As Reuters wrote at the time, the plan was to scale up from 19,000 to 80,000 units. Last year, Tata Motors had already announced plans to launch 10 electric models by 2026 and invest around $2 billion in new vehicle architectures, related technologies and infrastructure.
“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,” said Shailesh Chandra, Managing Director, Tata Motors Passenger Vehicles Limited and Tata Passenger Electric Mobility Limited.
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