Although MG Motor had a significant fan base in India, the company was struggling to expand its production and sales.
In this situation, after several months of negotiations, an agreement was signed yesterday in London to form a joint venture between China’s SAIC Motor and Sajjan Jindal-led JSW Group to expand MG Motor’s Indian operations. With this, JSW Group has acquired around 35 percent stake in the joint venture.
But in a statement published on behalf of JSW Group in October, MG Motor explained that the plan to take over the Indian business was not put to the management and no consultation took place. In the next two months, the alliance was solidified.
While the JSW Group has been in talks since June to take over MG Motor’s
While the JSW Group was till now only in the steel, electrical and paint manufacturing sector, it has ventured into the automobile sector by acquiring a 35 per cent stake in MG Motors.
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The giant car and engine maker Ford’s plant in Chennai has been closed for months due to its administration’s financial and trade freeze.
With the plant pending, it was reported in August that the JSW Group and Ford of America’s top management were in talks to take over the JSW Group’s Chennai plant. But after JSW Group’s denial of MG Motors, negotiations to take over the Ford plant stalled.
But now that JSW Group has acquired 35 percent shares of the successful MG Motor Company, through this new alliance, there is an expectation that negotiations will begin again to take over the Chennai Ford factory to increase the production of Hector and Aster SUV cars of MG Motor Company and the production of electric vehicles. While it is not certain whether JSW Group will start working on this immediately, chances are high.
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The Chennai Ford factory is spread over an area of about 350 acres, a structure capable of manufacturing 200,000 vehicles and 3.4 lakh engines per year. The Chennai plant has been closed since July 2022 due to the slump in Ford’s business. Taking over the Chennai Ford factory is a jackpot for MG Motor.
