Tata Motors, M&M eye fiat plant

Indian automobile majors Tata Motors and Mahindra & Mahindra (M&M) have shown interest in taking over the Termini Imerese plant owned by Italy’s largest car maker Fiat. Fiat has already decided to relocate the Termini Imerese plant, preferably to cost-effective areas of Poland or Germany, in 2011.

The exploratory work by Tata Motors and M&M, which have emerged as major players in the vibrant Italian auto market, is crucial especially when Chinese companies have conveyed their willingness to strike the deal with Fiat.

The plant makes the Lancia Ypsilon (a three-door hatchback) and has a daily production capacity of 400 cars, and employs 3,500 people. Another 3,000 are engaged in vendor and related activities.

Both Indian auto makers have shown their desire for the proposed takeover and are believed to have launched separate negotiations with Fiat. However both the managements declined to comment on the issue.