Ford Motor Company Executive Chairman Bill Ford has sought a meeting with Prime Minister Narendra Modi to discuss the company’s future plans in India.

“The Prime Minister’s Office, which is considering the request from the company, has asked for inputs from the Department of Industrial Policy & Promotion for the proposed meeting,” a government official told BusinessLine .

Ford India has turned into one of the largest exporters of passenger vehicles from India with the company shipping 73,821 units in the first half of the on-going fiscal registering a 32.25 per cent growth over the same period of last year. It was only slightly behind Hyundai Motor India, which was the top exporter in the period, shipping 87,499 units, according to industry data.

“The investment made by Ford in India has served the economy well. Although the company has not yet been able to sell as much domestically as it would have wanted to, it is trying to make up through its exports. The Centre would want to encourage such companies to invest more,” the official said.

One of the issues that Bill Ford may want to take up with Modi is the kind of dispensation India has in mind in the area of automobiles for its proposed free trade partners such as the EU or the RCEP countries (the 10-member ASEAN, China, South Korea, Japan, Australia and New Zealand).

“One of the reasons that Ford and other global automobile companies invested in India was the wall of protection provided to the domestic industry in the form of high import tariffs. If the tariff wall is dismantled or lowered for free trade partners, it would lead to tougher competition and investors would lose the advantage they currently enjoy over manufacturers that have not invested in India,” the official said.

Export hub

Realising that the competition in the domestic market was tough and it was not growing as much as expected, Ford Motors had changed its strategy for the country in 2013 by deciding to make it an export hub for small cars.

“There is a possibility that the company would make a case for more benefits for exports of automobiles,” the official said.

Ford, which re-entered the Indian market in 1995 after the market opened up to foreign investors, has two manufacturing facilities in India.

Ford EcoSport and Ford Endeavour are manufactured in its manufacturing facility at Maraimalai Nagar, near Chennai while its second unit in Sanand, Gujarat produces Ford Figo Aspire and the new Figo hatchback.

Related Topics