Tata Motors has acquired Ford’s plant in Gujarat’s Sanand at 725.7 crore rupees ($91.5 million).
The US automaker had invested around Rs2,000 crore in 2008—with plans to pump in Rs4,000 crore more—in the facility which will now be used to fulfil Tata’s electric vehicle (EV) ambitions.
Tata Passenger Electric Mobility, a Tata Motors subsidiary, yesterday (Aug. 7) signed the deal to buy Ford’s 1,100-acre plant along with all assets, including the land and eligible employees.
“With our manufacturing capacity nearing saturation, this acquisition is timely and a win-win for all stakeholders,” Tata Motors said in a statement yesterday.
The steep discount at which the deal was finalised reflects Ford’s plummeting prospects in India. The development comes nearly a year after the US auto major decided to end production in the country.
The Tata plant producing its ambitious Nano, a car that didn’t exactly set the charts ablaze in India, is also in Sanand.
Why did Ford sell its plant in India?
The Tatas have been eyeing Ford’s plant ever since the latter abandoned its EV plant in India this May.
Ford has been struggling with revenue: Last September, when it decided to stop production, it had less than a 2% market share, besides experiencing consecutive setbacks.
The company’s aim to open one outlet every week across India has come a cropper, too.
In 2019, Ford announced an alliance with Indian automaker Mahindra & Mahindra, aiming to cut costs. A year later, the partnership collapsed.
The US giant was eventually forced to exit the $30 billion Indian market.