Tata Set to Acquire Iveco in Major Global Expansion

Italian truck maker Iveco Group will sell its commercial vehicle business to Tata Motors for €3.8 billion and its defence unit to Leonardo for €1.7 billion. The deals, announced on Wedenesday, follow plans shared earlier this year to split Iveco’s defence operations from the rest of the company.

Iveco and Tata Motors are presumably complementary structures. The majority ownership of Italy’s Agnelli family has grouped its interest in the business with investment firm Exor, which has interests in automotive, food, reinsurance, real estate, and also operates the Smart Cities eye and digital services, all of which, with its heavy exposure in commercial vehicles, it seems a natural alliance with Tata given their interest in electric and autonomous development in a similar landscape.  

First, it is expected that the business plan of the two brands will produce a combined global sales volume of over 540k and revenue of about €22 billion. Overall, about 74% of IVECO’s 2023 revenue base is derived in Europe, which represents a huge opportunity. IVECO is also considered a leader in this sector. In addition, its commercial vehicle strategy might be able to increase IVECO’s exposure in this market, given that it currently does not have any commercial vehicle exposure across Europe.

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The valuable vehicles that Tata Motors will acquire are part of IVECO/CNG and ADAR companies’ defence division (IDV), which was sold to Leonardo for €1.7 billion. The IDV entities have an estimated 2k employees and return a core profit of approximately €108 million in 2024.  The acquisition of IDV is anticipated to close, given Leonardo’s timeline and pro forma, in early 2026.