Ford to stop local production in India, will only offer high-end cars via import

Ford Motor Co. has decided to shut both its manufacturing facilities in India and has blamed the decision on lack of profitability. In an official statement, Ford said that with accumulated operating losses of more than $2 billion over the past 10 years, it is now looking to ‘create a sustainably profitable business in India.’

Ford will gradually cease operations at its Sanand and Maraimalai plants and the entire process could take about a year to complete. “The decision was reinforced by years of accumulated losses, persistent industry overcapacity and lack of expected growth in India’s car market," said Anurag Mehrotra, President and MD at Ford India.

Jam Farley, President and CEO at Ford Motor Company, however, underlined that existing customers will be taken care of. “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," he said.

Ford also confirmed it will still offer some of its niche products like Mustang through the import route and that it will look to bring in new hybrid and full electric vehicles like the Mach-E here. As for the current product list, sales of cars like like Figo, Aspire, Freestyle, EcoSport and Endeavour will cease once dealer inventories are sold.

Rumours of a possible Ford exit from India has been doing the rounds for some time now even though the company had been - and still remains - tight-lipped. The going has been tough for the US auto maker as none of its products have made much of a mark in the Indian passenger vehicle segment. With the entry of newer players like Kia Motor and MG Motor in 2019, the transition towards BS 6, the pandemic hitting demand and production from time to time, and the global shortage in semiconductor, Ford may well have found going getting only tougher in India.

Talks of a joint venture with Mahindra and Mahindra also came to a naught for Ford. Facing losses, Ford had deputed one of its senior executives - Steven Armstrong - to evaluate the carmaker's investment in the country.