New Delhi. Veteran American auto company Ford has announced to stop the production of its vehicles in India. According to the report of news agency Reuters, the company has taken this decision due to continuous losses.
Ford India’s first offering was the Ford Escort, which was launched in 1996. It was made according to European specifications. Ford Ikon was launched in the year 1999 in Ford’s first joint venture with Mahindra. Its production continued till 2011. The Ford Endeavor came to India in 2003 and remains the only oversized SUV in its portfolio. Despite being dominated by the Toyota Fortuner in this segment, the Endeavor was successful in terms of sales.
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What was the reason for stopping production?
Ford has been going through a period of struggle in the Indian market for a long time. Simply put, Ford lost more than $2 billion over the past decade, according to Jim Farley, the brand’s president and CEO. Add to this the steep fall in demand and the high running costs of Ford’s Sanand plant, it seemed impossible to continue operations.
However, before Ford’s collective production rate in India fell to 20 per cent, Ford entered into a joint venture deal with Mahindra & Mahindra. With shared expertise, manufacturing facilities, platforms and engines, things were good for Ford until earlier this year, when the joint venture was closed. No clear information was given about the reason for any brand.
The company will stop production in Tamil Nadu by the second quarter of 2022
According to Ford’s statement, it will stop manufacturing cars in India and the Sanand (Gujarat) plant by the fourth quarter of 2021 and in Tamil Nadu by the second quarter of 2022. According to Anurag Mehrotra, Chairman and Managing Director, Ford India, the company has considered several options such as partnership, platform sharing and selling the plant.
dealers will be affected
Ford is not closing shop like the American company General Motors. The company has made it clear that it will continue to supply parts and service the customers. Dealers are likely to be affected. Ford will continue to import high end models. The sales of existing models like EcoSport, Figo, Aspire, Freestyle and Endeavor will cease after the inventory is cleared. The brand reiterated that the customer is their top priority.
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