Both players will invest Rs6.5bn each and the balance will come from debt. Fiat India plans to launch Grande Punto and Linea from the Ranjangaon plant
Fiat India Automobiles Pvt. Ltd., a 50:50 joint venture between Fiat Group Automobiles SpA and Tata Motors, has announced plans for expanding production capacity and backward integration at its Ranjangaon facility near Pune.
Fiat India yesterday signed a Memorandum of Understanding (MoU) with the Maharashtra Government for an additional investment of Rs23.4bn. With this investment, the company is taking the overall investment in Pune to Rs40.2bn.
Both players would invest Rs6.5bn each and the balance would come from debt, Fiat India CEO Rajeev Kapoor said.
Fiat India plans to launch two cars - Grande Punto and Linea - in the B and C segments, respectively from the Ranjangaon plant later this year.
By 2012, the capacity of the plant would be expanded to two lakh cars, three lakh diesel engines, and three lakh spare parts and accessories per annum. At present, the plant has a capacity to produce one lakh cars and two lakh engines.
Apart from the Grand Punto and Linea, the Ranjangaon facility would also make Fiat's 1.3 litre multijet diesel engines and 1.2 & 1.4 litre fire gasoline engines. The facility would also produce Tata Motors passenger cars.
At present, Fiat makes Palio Stile 1.1 and 1.6 models at Ranjangaon.
The Ranjangaon facility employs about 850 people and the capacity expansion is expected to create another 1,000 direct jobs. The overall employment potential of the plant, at its maximum capacity, has been pegged at 4,000 direct and indirect jobs.
