Case Study | Tata: Frontrunner taking over Ford’s TN unit?

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Logo of Tata Motors

The Tamil Nadu government is discussing with the Tata Group a probable takeover of Ford’s Indian unit in Chennai.

The rumor about the plant being taken over by Tata Motors got more solid news and reports about Tata Sons Chairman N Chandrasekaran’s meeting with CM M K Stalin and Thangam Thennarasu, industries minister of the state.

That was the second round of top-level talks that occurred in under two weeks. Last month on 27th, Girish Wagh, Tata Motors executive director, had a meeting with the CM.

However, the details of the meetings have not been disclosed. The announcement regarding the ultimate decision would come from the chief minister himself since he chaired those.

A spokesperson of Tata Motors said that Chandrasekaran had a courtesy meeting with the state’s chief minister, and the rest was in conjecture.

Ford’s plant in Maramalai Nagar has a yearly manufacturing capacity of 200,000 vehicles and 340,000 engines. It produced the EcoSport and Endeavour, which got exported to more than 30 countries.

The American-based carmaker had invested over a billion dollars in the plant at Chennai. Ford also operated a plant at Sanand, Gujarat.

Coincidentally, Tata Motors also had a unit in Gujarat and what is more coincidental is that both these units were located next to each other on the outskirts of Sanand. Tata, in this plant, manufactured Tiago and Tigor while Ford produced Figo, Freestyle, and Aspire.

Ford’s employees were shocked about an uncertain future following Ford’s exit from India. They also had almost 170 dealers in India, and collectively, they function around 400 showrooms. They also employ thousands of people across sales and post-sales services.

Ford was also in talks with firms like Ola and Mahindra & Mahindra about the plant, but that fell into the water.

Once the American automobile major announced the shuttering of its unit last month, the TN government declared that they would answer to the worried employees. The state government assured a smooth transition to another automobile giant.

However, all that said, the president of the Ford Workers Union, S Suresh, said that they have not received any official notice about the handover yet. He further said that the Tata Group have not visited the factory either.

The automobile group met with the CM of the state, but there could be many reasons for that, said Suresh. Hence, they are waiting for any communication in the future.

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