Tata Motors buys licensing rights for Fiat’s 2.0-litre Multijet Diesel Engine: A new beginning
Tata Motors has bought the licensing rights for Fiat’s 2.0-litre Multijet diesel engine, which is used in SUVs like Harrier and Safari. This engine is also fitted in Fiat’s Jeep Compass and Meridian models, and MG Motor India’s Hector and Hector Plus. According to Autocar India, Tata Motors has acquired this license from Stellantis, which is the parent company of Fiat India Automobile Private Ltd (FIAPL). After this license, Tata Motors will now be able to produce this engine at the Ranjangaon facility, which is a joint venture of Tata Motors and Stellantis.
What will be the benefit to Tata Motors?
How will Tata Motors get benefits from this license acquisition:
Independent Engine Development: Earlier, Tata Motors had to get approval from Stellantis for engine upgrades and modifications, which was quite expensive. Now Tata Motors will get freedom to upgrade the engine as per its own convenience.
Cost Savings: Earlier, Tata Motors had to spend up to 10 million Euros (approximately ₹97 crore) for every small modification. Now this expense will be reduced, which will be beneficial for the company.
Preparation for Emission Norms: Keeping in mind the upcoming emission norms, Tata Motors will now modify the engine accordingly, so that it does not face any regulatory challenge in future.
Product Portfolio Expansion: This engine will also be given in the upcoming Sierra model. Tata Motors will now be able to diversify its product portfolio, which will also expand the customer base.
Importance of Ranjangaon Facility
Ranjangaon facility, located in Pune, Maharashtra, is a joint venture of Tata Motors and Stellantis. This facility is known for engine and transmission manufacturing. Previously, Tata Motors and Fiat had made a joint investment of ₹3,000 crore in this facility to set up an assembly line for SUVs.
Impact on MG Motor India
It remains to be seen whether FIAPL’s other customer, MG Motor India, will get access to the upgraded engine developed by Tata Motors. The Fiat 2.0 diesel engine is now offered in the MG Hector, but MG Motor India plans to discontinue the diesel variant in its upcoming Hector model, which could be launched in 2026.
Final Thoughts
Tata Motors acquiring the licensing rights of Fiat’s 2.0-litre Multijet diesel engine is an important step. This will give the company independence in its engine development, which will enhance product quality and customer satisfaction in future. This move will help Tata Motors to strengthen its position in the Indian automotive industry. And as everybody knows, it all comes down to strength, then Tata’s cars are the best, that too in a low budget, Tata knows right from the beginning to make a strong car