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Ford to make India a hub for compact SUVs

(From right) Dave Schoch, president of Ford Asia Pacific; Alan Mulally, president and chief executive, Ford Motor Co., and Joginder Singh, president and managing director of Ford India. ((From right) Dave Schoch, president of Ford Asia Pacific; Alan Mulally, president and chief executive, Ford Motor Co., and Joginder Singh, president and managing director of Ford India.)Premium
(From right) Dave Schoch, president of Ford Asia Pacific; Alan Mulally, president and chief executive, Ford Motor Co., and Joginder Singh, president and managing director of Ford India.
((From right) Dave Schoch, president of Ford Asia Pacific; Alan Mulally, president and chief executive, Ford Motor Co., and Joginder Singh, president and managing director of Ford India.)

Firm aims to generate 60-70% of its global sales from the Asia-Pacific region by 2020

Chennai: Ford Motor Co. will make India an export hub for its compact sports utility vehicles, chief executive Alan Mulally said.

“India is a great market and is the lead edge indicator as to what people want in the world," Mulally said on Monday. “We are going to pay more attention to this segment. You will see more products in that segment."

Mulally was in Chennai to start production of the company’s compact SUV EcoSport at its Chennai factory, where it has invested $142 million to create a new production line that can produce as many as 10 variants of the model. The Chennai facility is one of the five plants that will produce this model, Mulally said.

Global small utility vehicle sales grew 154% between 2005 and 2012, according to IHS Automotive, a sector-specific consultancy. Ford’s small utility vehicle sales are estimated to outpace the overall industry growth, according to IHS Automotive.

Ford aims to generate 60-70% of its global sales from the Asia-Pacific region by 2020, Mulally said without giving details. “For the first time, we are making money. In the next 4-5 years, 40% of the revenues will come from Asia Pacific," he said. 

Ford has invested a total of $2 billion to set up manufacturing facilities in Tamil Nadu and Gujarat besides an engine facility in Gujarat.

Ford needs to introduce models more frequently in India, according to an industry consultant, who declined to be named as Ford is one of his clients.

“Look at what happened with Figo. They gained the momentum but could not sustain it. Their next product in the market (Fiesta) is overpriced and EcoSport is taking its own sweet time to hit the roads," he said. “In a market like India, you need to bring in products at a regular interval to keep the buyers interested in your brand."

Mullaly said the Ford management will focus more attention on India.

“Some six years ago, we realized that there has not been a focus on India but now we are serious about not only India but about the region," he said. The Asia Pacific region contributes 3% of Ford’s global sales.

Ford has long-term interests in the Indian market and the current slowdown in the market is just a temporary phase, he said.

“The slowdown will not come in the way of our commitment to India or the Asia-Pacific. We look at the long-term and in the long term, nothing is going to come in the way of economic development in the world and in India. That is our point of view," he said.

Mulally also said that he is pleased with the way Tata Motors Ltd has handled the Jaguar and Land Rover (JLR) brands, which was once owned by Ford.

“We are very pleased that Tata purchased JLR. The decision of selling those brands were in the context that how would the new Ford look like," he said. “That’s when we decided to let go some of the brands and the results of those decisions are visible in Ford’s global performance today."

After the 2008 global meltdown, Ford sold some of its luxury brands including Jaguar, Land Rover, Aston Martin and Volvo.

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