In the wake of high production yet low sales, Ford India to export engines to Europe
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American automaker Ford Motor Company is planning to transport engines built in India to Europe and other international markets, sources from the company informed. The multinational company is trying to use the expanding productivity of plants in India to their full potential.
Currently, Maruti Suzuki captures the biggest portion of the passenger car segment in India. However, let alone Indian brand names, Ford has not managed to surpass the popularity of even the other international players in the auto segment, which is primarily lead by Hyundai. The sales of Ford vehicles have been low even though there have been investments of more than USD 2 billion in establishing plants across the country.
It is estimated that, by the year 2015, the Indian plants of Ford will have the capacity to manufacture 600,000 engines. If the plan materialises, this will be the first time engines built in India will be exported to Europe. Gary Johnson, vice-president of manufacturing at Asia Pacific and Africa, said, "From an engine perspective, we'll be exporting not just to Europe but also to Thailand." He, however, did not provide any further details on the same.
"If somewhere needs more engines and we've got the capability, then we're going to ship them," Gary Johnson informed Reuters during an interview at a conference on automobiles in New Delhi. The current exports of Ford India to other countries amount to 40 per cent of the total number of engines produced and 25 per cent of the total units of cars.
President of Ford India, puts an end to speculation on whether cars too will be shipped to Europe. He says, "So it's probably not that smart to go and ship cars out of India to Europe... For us it's probably more you look at the engines."
The company is taking significant steps in the production units in Europe, calling off worker strength, curtailing weekly work hours and slowing down assembly of parts. Ford has speculated that in 2012, there will be losses worth USD 1 billion in Europe. In the second quarter alone of the fiscal year 2012, for every vehicle sold in the territory, the company ended up losing USD 1,125.
On the contrary, production is high in India even though sales are not as expected. 96,270 vehicles of Ford were sold in 2011, while leader among foreign companies Hyundai Motor India recorded sales of 373,709 units according to the companies.
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