Ford Motor cancels deal to sell its Tamil Nadu plant to JSW Group

Ford Motor will not sell its Tamil Nadu plant, the automaker's sole remaining factory in India, after finalising a deal with the Sajjan Jindal-led JSW Group.

Commenting on the recent developments, a Ford India spokesperson said, “We continue to explore alternatives for our manufacturing facility in Chennai and have nothing further to share.”

According to a report in The Economic Times (ET), the company had plans to shut down the Maraimalai Nagar-based plant in July 2022, after it left India due to losses and the slowdown that gripped the passenger vehicle market after the Covid-19 pandemic.

Recently, JSW had finalised an agreement to buy the Ford plant for around $100 million. But, earlier this month, Ford “called off the deal and is no longer looking to sell the factory”.

Vietnamese electric vehicle (EV) manufacturer VinFast, which is in the process of entering the Indian market, was another company said to have been in the fray for the Ford plant. Another company, Mahindra and Mahindra, had also said that it was interested in buying the plant. However, it later decided not to pursue the opportunity.

Ford India's main manufacturing plant located in Maraimalai Nagar, spread across 350 acres and shut since July 2022, has a capacity to produce 150,000 cars in two shifts, and 200,000 cars in three shifts. It has an annual capacity of almost 340,000 engines.

In January this year, Tata Motors acquired Ford Motor’s Sanand plant in Gujarat through its subsidiary Tata Passenger Electric Mobility Limited for Rs 725.7 crore in an attempt to boost EV production. This acquisition by Tata Motors included "land and buildings, the plant along with machinery and equipment, and the transfer of all eligible employees''.