Tata Motors has got the permission to take over Ford India's passenger car manufacturing plant in Gujarat's Sanand.
The Gujarat cabinet earlier this week cleared proposal submitted by the two carmakers, according to a report in Economic Times.
Tata Motors and Ford Motor Company would sign an MoU in the presence of Gujarat Chief Minister Bhupendra Patel on Monday, May 30, the report said.
Tata Motors will get the incentives and benefits given to Ford at the time of the plant’s inauguration.
US auto major Ford Motor Company decided to shut its operations and exit from India last year. According to the report, Tata Motors plans to make its EV at this plant after the takeover.
"The Gujarat cabinet's approval is only a green signal... The companies are still in talks to work out the nitty-gritties with regard to the deal size, labour issues, financials, and duties and benefits involved in the takeover. Once the two firms agree, a definitive agreement may be inked between the two automakers," ET quoted an official as saying.
Ford has said it had withdrawn plans to manufacture electric vehicles (EVs) in India and will not invest in the country under the performance-linked incentive (PLI) scheme.
“After careful review, we have decided to no longer pursue EV manufacturing for exports from any of the Indian plants. We remain grateful to the government for approving our proposal under the PLI and for being supportive while we continued our exploration. Ford India’s previously announced business restructuring continues as planned, including exploring other alternatives for our manufacturing facilities. We continue to work closely with unions and other stakeholders to deliver an equitable and balanced plan to mitigate the impacts of restructuring,” the company said in a statement.
Ford’s application, selected under the PLI scheme, was among the 20 other automakers that the Ministry of Heavy Industries had shortlisted under its Champion OEM scheme.