Tata Motors Ltd. has signed an agreement with the Tamil Nadu government to set up a new manufacturing plant, as India's largest automaker looks to expand its footprint in south India amid a demerger plan.
The memorandum of understanding envisages an investment of Rs 9,000 crore over five years to potentially generate up to 5,000 direct and indirect jobs, according to an exchange filing on Wednesday. Teams from Guidance, Tamil Nadu's nodal agency for investment promotion and facilitation, and Tata Motors Group will work together on this project.
The plant will come up in Ranipet district. Tata Motors has not disclosed what it intends to manufacture at this facility.
The MoU comes a little over a week after Tata Motors unveiled its demerger plan to split its truck and car-making businesses and list them separately in India. The commercial vehicle business and its related investments will be housed in one entity, while the other will include passenger cars, electric vehicles and Jaguar Land Rover. The demerger process is likely to be completed in 12–15 months.
This investment, however, is spread over five years, and expands Tata Motors' footprint in south India after its bus manufacturing facility in Dharwad, Karnataka. The Tata Group firm currently operates six plants in India, including those in Jamshedpur, Pune, Lucknow, Pantnagar in Uttarakhand and Sanand in Gujarat.
In a landmark move, @TataMotors has inked an MoU with the Government of Tamil Nadu to establish a vehicle manufacturing facility, investing Rs. 9000 crores and creating over 5000 jobs.
With this investment, Tamil Nadu further solidifies its position as the unrivaled automobile… https://t.co/cAuSMe0wogFor Tamil Nadu, this is the second automotive investment in the past couple of months.
In January, VinFast Auto Ltd., a Vietnamese automaker that rivals Tesla Inc. globally, said it will invest Rs 16,000 crore to build an electric vehicle plant in Thoothukudi, Tamil Nadu, to produce as many as 1.50 lakh units annually. The company plans to initially invest $500 million over five years to create 3,000–3,500 jobs in the region.
"Over the past couple of years, Tamil Nadu has hit the fast lane and become the ultimate hub for investments...," Tamil Nadu's Industries Minister TRB Rajaa said on X, formerly Twitter. "We're not just building factories, we're engineering dreams, and accelerating towards a brighter and more prosperous future."
The Tata Motors plant, as well as VinFast's under-construction facility in Thoothukudi and the Apple iPhone manufacturing facilities of Foxconn Group and Tata Group in Tamil Nadu, are seen as crucial to the state's endeavour to become a $1-trillion economy by 2030.
In the recently concluded investors summit, investments worth Rs 6.65 lakh crore were signed for projects that can potentially generate up to 25 lakh jobs in the state.
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