The Hindu Business Line : Ford India sees no break in capacity expansion plans

Chennai, Feb. 9 Ford India’s capacity expansion programmes are progressing as scheduled despite the slowdown in the Indian automotive industry and the recessionary trend in the US.

On the sidelines of the National Conference on Corporate Governance, organised by the Loyola Institute of Business Administration (LIBA), Ford India’s CFO and Wholetime Director, Mr G. Parthasarathy, told Business Line that the $500-million project announced in January 2008 is going as planned.

According to earlier reports, about 70 per cent of the investment will come from the parent company in the US as equity and the rest is managed through internal accruals and debt by Ford India. Despite the slowdown in the US, there is no dearth of funds from the headquarters.

“We have been receiving funds; the latest was two weeks ago. We are going ahead with the project as we are working on a specific product to be launched in 2010. I think things will settle down by then and it would be the right time to come out with a new product,” he said.

The project will be completed by early 2010. The expansion programme will double its vehicle manufacturing capacity to 2 lakh units a year and add an engine manufacturing facility with a capacity to make 2.5 lakh engines annually. The engines will be for captive consumption and exports.

individual ethics

Addressing the conference, Mr Parthasarathy said corporate governance was nothing but individual ethics and principles under the umbrella of the organisation. He said that for organisations to demonstrate corporate governance, it is not sufficient if companies proclaim high standards. Instead they must live with them on a day-to-day basis.

Ford has policies and guidelines to help align the values of corporations uniformly at all levels. The company dwells upon an extensive orientation programme and periodical refresher modules to sustain practising corporate governance. Training programmes are evaluated and in some cases, those who score less than 80 per cent are asked to repeat the module.

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Ford India sees no break in capacity expansion plans