Tata Acquires Rights to Develop Fiat’s 2.0L Diesel Engine In-House

Tata Motors has acquired the license to independently develop and modify the Fiat-sourced 2.0-litre Multijet II diesel engine, currently used in the Harrier and Safari SUVs. The engine, produced at the Ranjangaon plant under a joint venture between Tata and Stellantis (FIAPL), will continue to be manufactured there, but Tata now holds the rights to upgrade and recalibrate it to suit its own requirements.

More Control for Tata

The move is a smart step for Tata, giving it control over one of its most important engines. Previously, even minor changes to the engine, like ECU recalibrations, required costly approvals from Stellantis, often slowing down progress and inflating development budgets.

With the new licensing agreement, Tata can now upgrade the engine to meet future emission norms, introduce multiple states of tune, and offer varied power outputs across models, similar to what Mahindra already does with its 2.2L mHawk diesel engine.

More Performance, Less Cost

One of the major pain points in the earlier agreement was the cost of calibration. A single change to the ECU could cost up to €10 million, limiting Tata to only a 170 hp version for both Harrier and Safari. This lack of variation made it difficult to offer tiered variants, a strategy commonly employed in the SUV segment.

Now, Tata engineers can explore more powerful variants, such as the long-rumored 180 hp tune and potentially even introduce multiple drive modes to enhance the customer experience.

Strategic Timing

The acquisition comes at a critical time as Tata’s flagship SUVs face increased competition in the Indian market. With Mahindra's Scorpio N and XUV700 offering a broader powertrain lineup, this new development gives Tata the arsenal it needs to compete more aggressively.

A Tata Motors spokesperson commented, “The licence enables TMPV to carry out developments and technical changes in the 2.0-litre diesel engine to meet upcoming regulations and performance targets. This means we now have the flexibility to improve overall vehicle performance in-house.”

Production to Continue at FIAPL

Despite the newfound control, Tata confirmed that manufacturing of the engine will continue at the FIAPL plant for both Tata and Stellantis. The intellectual property rights for the core engine still remain with Stellantis, but any modifications made by Tata will be owned by the Indian automaker.

What remains uncertain is whether other FIAPL clients like MG Motor India, whose Hector also uses the 2.0L Multijet, will benefit from these upgrades. Industry insiders suggest that MG may phase out diesel entirely by 2026.

Smart Investment

Instead of investing in a new diesel engine platform, an expensive and time-intensive venture, especially with the world shifting toward electric vehicles, Tata’s licensing deal provides a cost-effective way to enhance an already proven engine.

The 2.0-litre Multijet II diesel, developed by Fiat Powertrain Technologies (now part of Stellantis), has a global footprint through a customer-supply program. Though not cutting-edge, it remains a relevant and reliable engine for the SUV segment, now fully under Tata’s functional control.