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Business News/ Companies / Ford to join small car race, but not with Rs1 lakh price tag
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Ford to join small car race, but not with Rs1 lakh price tag

Ford to join small car race, but not with Rs1 lakh price tag

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New Delhi: Ford India, a unit of America’s second largest car maker, is open to launching a compact car for the local market, but said it would not be a product in the Rs100,000 price range proposed by competitors.

“At the moment we are not looking at that price point, we are just looking at a small car. Ford does not have any product in that price range," Ford India managing director and president Arvind Mathew told reporters here.

He, however, said the company may consider such a low cost car coming at $3,000 as announced by Renault-Nissan if “customers demanded for it".

Home-grown auto major Tata Motors is planning to roll out a compact car priced at 100,000 by middle of next year.

“We are always focused on what our consumers want... if our consumer comes back and says here are the trade-offs, I am willing to make ($3,000 car) and this is what I will accept and live with," he added.

He was non-committal on the company’s plans if such a scenario were to happen. “At the moment I am not being categorical, I am very curious to see how this car looks like," Mathew added.

Ford currently sells only mid-size sedans such as Fiesta, premium hatchback Fusion and SUV Endeavour in the Indian market.

The company on 17 July launched a diesel variant of Fusion priced at 6.59 lakh (ex-showroom Delhi). The variant would be powered by a 1.4 litre Duratorq engine.

Mathew said the new product would enhance Ford’s diesel portfolio in the Indian market, which currently has only the Fiesta sedan. Fiesta diesel presently contributes nearly 70% to the overall sales of the model.

Ford India has achieved localisation levels of 60% on Fusion, while Fiesta is made from 80-85% locally sourced components.

The 1.4 litre powered Fusion diesel is the first product from Ford India’s stable which qualifies for a 6% rebate in excise duty on small cars.

The government had, last year, reduced excise duty on small cars to 16% from 22% in order to promote India as a hub for small cars. All petrol cars of up to 1.1 litre engine capacity and diesel cars up to 1.5 litre engine capacity are eligible for the excise duty benefit.

On possible synergies between Ford India and Volvo, Mathew said two companies would exist as independent entities in India and there was no scope for joint marketing.

“Volvo and Ford have no plans for common marketing. There is nothing common between the two companies and nothing of this sort is being looked into," he added.

US-based Ford Motor Company owns the Volvo passenger car business.

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Published: 17 Jul 2007, 06:45 PM IST
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