Tata Motors, Fiat formally announce joint venture in India
New Delhi (dpa) - Indian car maker Tata Motors and its Italian partner, Fiat, Thursday announced an agreement for the formation of a joint venture to manufacture passenger vehicles, engines and transmissions for the Indian and overseas markets.
The two companies had in July inked a memorandum of understanding (MoU) to establish an industrial joint venture located at the Fiat plant in the Ranjangaon Industrial Area in India's western Maharashtra state.
The formal announcement comes days after the Italian company got an approval from India's Foreign Investment Promotion Board (FIPB).
"With capacities to produce in excess of 100,000 cars and 200,000 engines and transmissions yearly, at steady state, the Ranjangaon plant will manufacture vehicles for the Indian and overseas markets," said a statement issued by the companies.
"Both Fiat and Tata vehicles will be manufactured at the same facility, which will be managed equally by the two shareholder partners," the statement added.
The aggregate investments in the project may exceed 890 million dollars and the joint venture would start production of engines and new cars from early 2008.
Under the agreement, Fiat Auto will introduce its premium cars, the Fiat Grande Punto and the Fiat Linea whose worldwide premiere occurred at the Istanbul Motor Show in early November.
Fiat cars will be distributed by Tata through its select outlets while Fiat would give the Indian auto major access to its technology and marketing support in overseas markets.
Tata Motors is India's largest carmaker with revenues of about 4.7 billion dollars (3.9 billion euros).
Fiat and Tata are also holding discussions for industrial and commercial cooperation in Latin America. The negotiations were "progressing positively", the statement said. // © 2006 DPA