Ford to end manufacturing operations in India -
Ford to end manufacturing operations in India
Posted 09 Sep 2021 04:23 PM


Ford to end manufacturing operations in India


Ever since Ford's joint venture with Mahindra ended, the American brand's future has been in murky waters. The company earlier this year announced that it is looking for a new partner for its India operations but rumours of the brand shutting down its India operations kept surfacing in media reports. But now, Ford has confirmed that it will end its India operations and will stop manufacturing cars in the country. The company will immediately stop the production of existing vehicles for the domestic market and will end operations at its Sanand and Chennai plants by Q4 2021 and Q2 2022, respectively. Ford will continue to sell existing vehicles like EcoSport, Endeavour, Figo, Aspire, and Figo Freestyle till the stock lasts and no new vehicle will be manufactured. This may come as a surprise to many as the shots of EcoSport facelift and its expected to launch later this year suggested that the company had plans of continuing operations here. This was further reinforced by the recent launch of the Ford Figo Automatic. However, turns out that India isn't a profitable market for Ford from an investment viewpoint, leading to the company's decision of ending its operations here. The company had accumulated operating losses of over $2 billion and a $0.8 billion non-operating write-down of assets in 2019. Ford, however, will continue to provide after-sales and service support to the customers in India. However, the company will have a lesser number of customer touchpoints in the country and the dealerships will be converted into service entities.

Furthermore, Ford will continue to rely on India-based suppliers for parts for its global products, and suppliers and vendors supporting Ford Business Solutions will continue to support the business. It is worth noting that the company's decision to end manufacturing in India will impact around 4,000 employees. The company said that it will work with employees, dealers, government, and other stakeholders to "mitigate the effects of the decision." But does this mean Ford is going the GM way and completely ending all operations here? The company has noted that it will end local manufacturing of cars in the country but will sell some imported products. Perhaps the Ranger pick-up truck that was spotted here earlier this year could also come to India via the CBU route. But more importantly, Ford noted that it will be bringing imported vehicles like Mustang Coupe and Mach-E electric SUV to our shores. Jim Farley, President and CEO, Ford Motor Company, said, "Despite investing significantly in India, Ford has accumulated more than $2 billion of operating losses over the past 10 years and demand for new vehicles has been much weaker than forecast. I want to be clear that Ford will continue taking care of our valued customers in India, working closely with Ford India’s dealers, all of whom have supported the company for a long time. India remains strategically important for us and, thanks to our growing Ford Business Solutions team, will continue to be a large and important employee base for Ford globally."

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