Ford India is trying its best to capture the Indian market. Since the production charges are lower in India as compared to the European and American nations, Ford is planning to make India its global car manufacturing hub. Ford India has chalked out a project code named as B562. This project will kick start after the manufacturing facility in Sanand in Gujarat is fully operational which can happen only in 2014. As per this project, Ford is developing a car platform which can be used for different car styles. Based on this one common platform, Ford will launch a sedan, a sub 4 meter sedan and a small hatchback. These 3 cars will reach the market in the next 2 to 3 years.
It is expected that this step taken by Ford in transforming its Indian base will make it equally important as compared to their foreign based plants. Tracking the progress made by the company on this project B562, it has been found out that that compact sedan and small hatchback are moving on swiftly but the sub 4 meter sedan is still in the planning phase.
Global CEO of Ford Motor, Allan Mulally, said to the media that “The demand is dramatically down for cars in Europe, like it was in United States. So we are moving production, consolidating our facilities, but at the same time, we are accelerating the new vehicles. Customers want value, so it is going to take us a couple of years to finish that restructuring, we are doing the right thing for the customers and right thing for Ford.”
A company official, showing his faith in the company’s strategy has said that “We would not speculate about our future product strategy and business operations. Ford India’s product-led transformation continues with the introduction of the EcoSport and currently we have a laser sharp focus to deliver it for our customers.”
EcoSport has turned out to a great venture for Ford. It is setting selling records all over the world and is giving tough competition to some acclaimed cars. But Ford officials believe that Project B562 is way above the EcoSport. An official said that “The cars are being developed with an aim of garnering profits quicker than some of the earlier projects. In terms of volumes, the platform will deliver largest volumes for Ford India going ahead and is expected to come with a localization level of over 90%”
In order to explain the need for restructuring the Indian base, MD, Sullivan and Frost of South Asia, V G Ramakrishnan said that exports give a momentum to Ford to make their domestic products more economical. An example of this is the EcoSport which is ruling owing to its correct pricing. In addition to this the company also gets to offer new technology at affordable prices to its customers. He said that “With the stringent implementation of transfer pricing, Ford’s Indian operation will be exporting vehicles for a decent profit. With the higher exports, the balance sheet will get a boost and whatever losses the company has incurred, it will be able recoup it faster. Also, the European customers are generally more discerning than Indian buyers, a European specked car for the Indian buyers would help Ford move up the ladders in sales and customers perception.”
One of the officials working closely on this project said that “The company plans to produce over 2,00,000 cars on B562 platform by 2015-16 and over 30-50% is planned to be exported to the overseas markets over a period of time. The company tested the overseas markets with Figo, they now plan to aggressively expand exports with the EcoSport and with the B562 cars, the company intends to make the best use of its competitive production base in India.”
Once launched, the new small hatchbcak will join Ford Figo while the sub 4 meter sedan will compete with Honda Amaze and Maruti Suzuki Swift Dzire. The compact sedan will take Ford Fiesta Classic’s place in the market. In the international markets, the hatchback will probably replace Ka small cars.