Tata Motors To Set Up Rs 9,000 Crore Vehicle Manufacturing Plant In Tamil Nadu

Tata Motors has taken the next step towards expanding its production capacities by announcing it will set up a vehicle manufacturing facility in the state of Tamil Nadu. The Tata Motors Group today signed a memorandum of understanding (MoU) with the Tamil Nadu government to explore the establishment of a new vehicle plant, and the MoU was exchanged in the presence of the Tamil Nadu Chief Minister M.K. Stalin, V Vishnu, IAS, Managing Director & CEO, Guidance, and PB Balaji, Group CFO, Tata Motors.

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The company will invest a total of Rs 9,000 crore into this new plant over a period of five years, and this move is estimated to generate up to 5,000 new jobs, the company said in a statement. Following the signing of this MoU, teams from Guidance, Tamil Nadu's nodal agency for investment promotion and facilitation and Tata Motors Group will work together to take this opportunity forward, as per a statement from the company.

Tata Motors has already acquired the erstwhile Ford India plant in Sanand to build its next-generation EVs.

At this point, the Tata Motors Group has not specified if the new plant will be used to produce passenger vehicles or commercial vehicles. The company recently announced a demerger plan, under which Tata Motors Ltd will be divided into two separate listed companies. The first entity will house the commercial vehicles (CV) business and its related investments, while the second will incorporate the passenger vehicles (PV) businesses, including PV, EV, and JLR (formerly Jaguar Land Rover), along with their associated investments.

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Tata Motors already acquired the erstwhile Ford India plant in Sanand, Gujarat, where it will build its next generation of electric vehicles. Production of Tata’s combustion engine vehicles began at the plant early in 2024 after the acquisition was completed by Tata Motors’ EV subsidiary last year.

This is the second major investment drawn by Tamil Nadu from an automaker in 2024 after Vietnam’s Vinfast made a commitment to set up an electric vehicle and battery manufacturing facility in the state, at an initial cost of USD 500 million (Rs 4,160 crore approx) for the first phase over five years.