BENGALURU, India — Tata Motors has signed an settlement to probably purchase a Ford manufacturing facility within the western Indian state of Gujarat because it seems to ramp up its manufacturing of electrical autos.

The proprietor of Jaguar Land Rover already dominates India’s fledgling electrical automotive market, which the federal government is attempting to develop by providing corporations billions of {dollars} in incentives.

The memorandum of understanding introduced on Monday covers the land, property and all eligible workers working on the Sanand facility. The monetary particulars of the settlement weren’t disclosed.

Tata stated it could spend money on new equipment and gear on the plant by way of its electrical mobility unit and expects the power to have a manufacturing capability of 300,000 models every year after the works full. The capability may be elevated to greater than 400,000 models.

“Rising buyer desire for passenger and electrical autos made by Tata Motors has led to a multi-fold development … this potential transaction will help growth of capability,” stated Shailesh Chandra, managing director of Tata Passenger Electrical Mobility.

Tata final 12 months raised $1 billion from non-public fairness agency TPG for its EV enterprise and competes within the house with Mahindra and Mahindra.

The curiosity within the Sanand plant follows U.S. automaker Ford’s resolution final 12 months to cease manufacturing in India, the place it had a lower than 2 p.c share of the passenger automobile market and had struggled to show a revenue for greater than twenty years.

Ford stated earlier this month it was in search of choices for its two factories within the nation whereas shelving plans to make electrical autos in India for exports.