Another success! Tata cars will now be made at Ford's plant in Sanand, know how many crores the MOU was signed

Tata Passenger Electric Mobility (TPEML) and Ford India Pvt. Ltd. (FIPL) signed a Unit Transfer Agreement to purchase the plant located in Sanand, Gujarat

A big news has come out about the Ford India manufacturing plant located in Sanand. Tata Motors has signed a deal to buy Ford India’s Sanand-based manufacturing plant for Rs 725.7 crore. According to the details, Tata Motors said in a statement that Tata Passenger Electric Mobility (TPEML) and Ford India Pvt. Ltd. (FIPL) has signed a unit transfer agreement to purchase the plant located in Sanand, Gujarat. Under which eligible employees will also be transferred.

Tata Passenger Electric Mobility Limited, a subsidiary of Tata Motors Limited, and Ford India Private Limited have today signed a Unit Transfer Agreement. The agreement entered into for the acquisition of Sanand-based Ford India Pvt Ltd includes the vehicle manufacturing plant along with the entire land and buildings, machinery and equipment therein. Also, a total consideration of Rs 725.7 crore excluding tax has been fixed for the transfer of all eligible employees involved in the vehicle manufacturing operations of FIPL at Sanand.

Ford India’s Sanand plant is spread over 350 acres. While the engine manufacturing plant is spread over about 110 acres. In May this year, Tata Motors got approval for the takeover of Ford’s passenger car manufacturing plant. After which this proposal also got the approval of the Central Cabinet. Importantly, Ford Company had announced last year to consolidate its business from India.

What is involved in this deal?

Under this deal Tata Passenger Electric Mobility will acquire the assets of Ford India. It includes land and building, machinery and equipment along with vehicle manufacturing plant. Tata Motors in its statement also said that this asset transfer deal also includes the transfer of eligible employees working at Ford India’s Sanand plant. FIPL will continue to operate its powertrain manufacturing facility by leasing back the powertrain manufacturing plant land and buildings from TPEML on mutually agreed terms.

The Government of Gujarat, TPEML and FIPL have already entered into a tripartite agreement on 30 May 2022 to cooperate in all necessary approvals related to this deal. Tata Motors said, this deal is beneficial for all stakeholders. The production capacity of the Sanand plant is 3 lakh units per annum. Which can be increased to 4.2 lakh units annually. The company said that Tata Motors will also invest in plant modifications with the aim of adopting existing and future vehicle platforms.