Tamil Nadu govt considers 'unlocking' Ford India for real estate purposes

Other options such as plant takeover by an automobile manufacturer also on the table, says state industries minister

In its prime, Ford India’s manufacturing unit in Maraimalai Nagar, around 45 kilometres from Chennai, was considered to be an iconic destination for India’s automobile industry. However, about two years ago, on September 9, 2021, its fortune took a sudden turn when the automobile major decided to pull out of India and stop all vehicle manufacturing in the country. Now, the Tamil Nadu government is mulling using the plant land “innovatively”.

Also Read: Ford India, Unions reach final severance deal for Chennai unit employees
 

While various options on how to utilise the facility have been considered in the past, any plan will have to be cleared by the state government. The American auto firm still has the ownership of the land.
 

“We have another idea around the Ford real estate. We are thinking about some innovative approach for its usage. We will try to make good use of it for the public at large. It should help the state and its people. Whichever is good for jobs and revenue generation, we will go with that,” State Industries Minister TRB Rajaa told Business Standard. He, however, did not reveal the details of the plan. The state government, however, is not brushing aside the possibility of another major manufacturer coming in and taking over the unit. Rajaa said the state was also in talks with several automobile manufacturers, including a major global brand, for the takeover of the unit.
 

When contacted, a spokesperson for Ford India said the company was looking at alternatives. “We continue

to explore alternatives for the Chennai plant and have nothing further to add,”  he said. 
 

The plant, which employed over 2,500 workers at the time of shutdown, had an annual manufacturing capacity of more than 150,000 cars on a two-shift basis and 200,000 with three shifts. The company was forced to close down its India units due to a dip in volumes and after suffering an accumulated loss of around $2 billion. Ford rolled out the last vehicle from the Tamil Nadu unit in July 2022.
 

“We are looking at a lot of options, as it is a prime land. There are many options on the table. I think Ford will take a wise call on that. Right now, it is Ford’s property; they will also be on board. They will decide on it,” Rajaa said.
 

In the last two years, there have been separate reports that Tata Motors, Ola Electric, and Mahindra & Mahindra were in talks to take over the plant. However, it didn’t materialise.
 

Another plant of Ford India, in Sanand (Gujarat), was acquired by Tata Motors through its subsidiary Tata Passenger Electric Mobility in a Rs. 725 crore deal, announced in August 2022.
 

After the announcement of the production-linked scheme,Ford India had said last year that it was exploring the possibility of using a plant in India as an export base for EV manufacturing. It later decided not to pursue the plan.

FORD’S INDIA JOURNEY

• 1999: Ford India starts production at Chennai plant
• 2010–11: Annual production crosses 100,000 mark
• Sept 2021: Decides to pull out of India 
• Aug 2022: Tata Passenger Electric Mobility decides to acquire Sanand unit ~725 crore
• Sept 2022: Ford India strikes deal with Chennai unit employees for severance package
• Jan 2023: Tata Motors completes acquisition of Sanand unit
• Jul 2023: Tamil Nadu plans to ‘innovatively’ use the unit’s land