The Hindu Business Line : Ford expects turnaround well ahead of utilising full capacity of plants

Bangalore, Dec. 8 The US car maker Ford has said its Indian operations are expected to turn around much before the company utilises the full capacity of its plants.

“We may not have to go the full distance of fully utilising our capacities to turn around. We should be able to reach there much earlier,” Ford India’s Executive Director for marketing, sales & service, Mr Nigel E. Wark, told Business Line. Ford’s plant near Chennai can produce up to 2 lakh cars a year, while its engine plant can make 2.5 lakh units every year.

An earlier report in Business Line had said Ford suffered a loss of Rs 51 crore for 2007-08 compared with a profit of Rs 20 crore during 2006-07.

Mr Wark said despite year-end sops from the Government and its new Ford Ikon’s diesel version getting immediate response from the customers, Ford will still end up with a 20 per cent reduction in sales for 2008 because the fourth quarter of the calendar year has been extremely disappointing. “(The year) 2009 has the potential to be better though our biggest concern continues to be availability of finance for our customers,” he said.

He, however, said the new Ikon diesel, which has received extremely good response, should drive sales of the company. “We expect a very strong first quarter next year because of the sales of Ikon diesel version,” he said. Ford expects to sell about 1,000 cars of Ikon every month.

The car maker recently launched the diesel version of Ikon at a price of Rs 5.19 lakh (ex-showroom). He pointed out that it took Ford nearly two years to bring Ikon diesel to Indian roads. Ford carried out durability tests for about 1 million km for Ikon diesel before formally launching it in India. “Even the small car project is a three-year project,” he said.

End of discount

Mr Wark said the recently announced Rs 91,000 discount on its sedan Fiesta model should end soon and there are no plans to reintroduce the scheme.

“It is not a sustainable price. Our aim was to move the model faster and we have succeeded in doing it,” he said.

He said most of the products which Ford will launch in India will be made specific to the country. “We will make products in India for the local market instead of taking a global product and customising it for the country,” he said.

He said one of the lessons learnt from the current global recession was on how the company can make products that can sell at all times. “If your USP is well, you will always sell,” he said.

He said customers in India are extremely demanding and hence, it was always a challenge to make the “right” product for them.

“If you can get it right for India, you can get it right for the rest of the world,” he pointed out.

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