Tata Group Signs $1.58 Bn Deal To Build Lithium-Ion Cell Factory

Tata Group has entered into an outline deal to construct a state-of-the-art lithium-ion cell factory. The project, estimated to require an investment of approximately Rs 130 billion (USD 1.58 billion), aims to bolster India's efforts in establishing its own EV supply chain.

A memorandum of understanding (MoU) was signed between Tata's subsidiary, Agratas Energy Storage Solutions, and the government of Gujarat. The proposed factory will be situated in Sanand, northern Gujarat, and is anticipated to commence operations within three years.

The initial phase of the facility will have a manufacturing capacity of 20 Gigawatt hours (GWh) of lithium-ion cells. Furthermore, the factory's potential for expansion in a second phase could potentially double its output capacity, thereby meeting the escalating demand for EV batteries in the country.

India's automobile market is relatively small when compared to its population. However, Tata Motors has emerged as a dominant player in the EV segment, even though electric vehicles accounted for only 1 per cent of the total car sales, which stood at approximately 3.8 million units in the previous year.

Vijay Nehra, an official from the Gujarat state government, expressed optimism regarding the forthcoming plant, emphasising its substantial contribution to the development of the EV ecosystem not only in Gujarat but throughout India as well.