New Delhi: American Auto Giants doesn’t seem to do it when making cars and motorbikes for Indians.
After leaving General Motors and Harley-Davidson, now the change of other iconic brands Ford to get out of India.
After investing more than $ 2.5 billion in India, and with the presence since 1995, Ford ended 2020-21 selling 48,042 units to collect 1.8% pie share.
The company promises that the “restructuring” of India – which will see two factories in Chennai and Sanand closed in the second quarter of next year – will not mean the end of service and after-sales support for customers around 10-lakh.
It’s in this country because 300-strange dealers will remain open to service.
“This is a very difficult decision.
No matter what we try and investigated, all of our projections show we will continue to provide sub-optimal returns to shareholders and investors.
There is no other choice, but to restructure,” Anurag Mehrotra, MD and Ford President India said when he described a new strategy that would see the company started the import and sales of “compulsory, iconic vehicles”, including Mustang Coupe, including the Mustang Coupe.
Ford said making a decision after considering several options, including partnerships, sharing platforms, making contracts with other makers, and the possibility of selling manufacturing factories, which are still in consideration.
“Apart from these efforts, we have not been able to find advanced sustainable pathways to long-term profitability which include vehicle manufacturing in the country,” Mehrotra said.
This step will see many permanent employees 4,000-odd Ford India moves.
“Ford will work with employees, trade unions, suppliers, dealers, governments and other stakeholders in Chennai and Sanand to develop a fair and balanced plan to reduce the impact of the decision,” said the company.
The dealer was afraid that was released from work in Ford, more than 40,000 employees at the company’s retail points also faced threats around their work.
VINKESH GULI, President of the Fada dealer association, said the Ford dealer has invested around Rs 2,000 Crore to retail infrastructure and services.
“The retail brotherhood was really surprised to hear Ford’s announcement where he said that it would turn off production,” said Fada.
While the writing was on the wall for several months, Thursday’s announcement brought finality for it.
Ford failed to grow on the market where other people such as Maruti, Hyundai, Tata Motors and Mahindra, reap in dividends.
Newcomers like KIA Korea and China MG motorbikes also managed to get a solid opening, although starting at the end of 2019.
Ford’s losses to date stand at $ 2 billion (it also affected A $ 0.8 billion non-operating assets in 2019 ), and the company says it prefers to invest money in the market where it can take refunds rather than Sink further money in India.
However, the exit brings further cash expenditure for the company, which is estimated to be more than $ 1.7 billion, including various settlements, apart from $ 0.3 billion in non-cash accusations.
However, the company will continue the ‘Ford Business Solutions’ program in India, where it employs 11,000 members engaged in software development, data science, R & D and Finance and Accounting.
Ford India will maintain a smaller supplier network to support the manufacture of machines for export and will work with other suppliers to ensure wind manufacturing smooth vehicles.
Closing appeared several months after Ford’s last attempt to forge JV with M & M failed.
The partnership, which has been conducted since 2019, was summoned on the last day of 2020, as it was decided by Mahindra to return to “core fiscal discipline”.
(With input from Nandini Sengupta in Chennai)