Tata, Fiat complete JV modalities

Tata Motors, India's largest auto house, and Italy's Fiat Group Automobiles today signed a definitive agreement for establishing a joint venture (JV) pursuant to the agreement signed in December 2006, which highlighted the formation of the venture.

All the legal formalities between the two companies are complete and the JV will now be a associated as a full-fledged manufacturing partnership. The JV, through its manufacturing plant at Ranjangaon in Maharashtra, will make cars and engines for the domestic and export markets.

The JV's board of directors will have equal representation from both partners. Tata Motors, managing director, Ravi Kant will be the chairman of the JV while Alfredo Altavila, CEO, Fiat Powertrain Technologies and senior vice president (business development), Fiat Group Automobiles, will be the vice chairman.

Rajeev Kapoor, who was the vice president and plant head at Hero Honda, will be the president and CEO of the JV.

A memorandum of understanding was signed between the companies in June last year, which was followed by a joint venture agreement in December. According to the agreement, both parties will make a joint investment exceeding Rs 4,000 crore in the Rajangaon facility over a period of time.

Commenting on the agreement, Altavilla, said, "The signature of the JV and the continuous development of new opportunities confirms the strong motivation and understanding between Fiat Group and Tata Motors."