Tata Motors eyes India manufacturing for Iveco products after acquisition

Tata Motors plans to localise select Iveco products in India as the companies explore ways to expand in each other's markets and build a larger commercial vehicle business.

Tata Motors is looking to manufacture select Iveco Group products in India as it seeks to expand the Italian commercial vehicle maker's presence in the country following their coming together.

Speaking at a global press conference in Turin, Italy, Tata Sons Chairman N Chandrasekaran said the companies were identifying products that could be made locally, opening up opportunities for Iveco in the Indian market.

"We can drive growth at both ends with this deal," Chandrasekaran said, adding that the partnership would combine the industrial heritage and technology of the two companies.

The combined commercial vehicle business will employ more than 70,000 people and generate annual revenue of over €22 billion, Chandrasekaran said. The companies are expected to produce around 600,000 vehicles a year, with combined revenue of approximately $24 billion.

He said the scale of the combined business would create opportunities to develop future products, adding that scale was as important as technology in the commercial vehicle industry.

India becomes a key market in the Iveco integration

Chandrasekaran said the companies were beginning to assess the future of Tata Motors' commercial vehicle business and Iveco together, looking for areas where their operations and product portfolios could complement each other.

Both companies are profitable and generate cash, with operations across India, Europe and Latin America, he said.

They will explore opportunities to expand in each other's markets, including bringing Iveco products to India through local manufacturing.

Iveco's headquarters will remain in Turin, Chandrasekaran said, ruling out a move from the Italian city.

Iveco delisting process underway, no timeline yet

Tata Motors is working on the delisting process for Iveco, Chandrasekaran said, but did not provide a timeline.

Tata Motors acquired an 89.42% stake in Iveco Group for around €3.43 billion after the initial settlement of its cash tender offer on October 30. The transaction made Iveco an indirect subsidiary of the Indian automaker.

The acquisition excludes Iveco's defence business and is Tata Motors' biggest acquisition since it bought Jaguar Land Rover from Ford in 2008.

Iveco Chief Executive Officer Olof Persson will remain in his role. Chandrasekaran has been appointed chairperson and senior non-executive director of Iveco, while Tata Motors executives P B Balaji and Girish Wagh have joined its board as non-independent, non-executive directors.

At the press conference, Wagh recalled Tata Motors' long-standing association with Turin.

"When Ratan Tata wanted to manufacture cars, he turned to Turin," Wagh said, referring to the city's historical ties with the company.