American carmaker Ford has approached at least half a dozen auto manufacturers to delve into several options to sustain its 25-year operations in India following a failed JV deal with Mahindra & Mahindra.
Ford India has reportedly reached out to Tata Motors, Changan Automobiles, Skoda-Volkswagen Group, Shanghai Automotive or MG Motor, Hyundai Motor and some EV (electric vehicles) startups comprising Ola Electric to explore contract manufacturing opportunities, partnerships, or even the sale of one of its facilities.
The company is considering these options as it looks for ways to achieve the mid-term target of 8% EBIT (earnings before interest and taxes) margin by 2023 announced by its global CEO Jim Farley, sources told ET.
They further stated that with export volumes declining and India operations grappling with a dated product portfolio, Ford is sure to close down or sell one of its plants.
In the worst-case scenario, the company may shut both its factories and convert its Indian unit into a niche operation, retailing CKD (completely knocked down) variants of premium models Ranger, Endeavour, and Mustang Lincoln while keeping doors open for EVs, sources told the publication.
A decision on the way ahead, they said, may be made within a couple of months.
Stating that the company would not like to comment on "speculations", a Ford India spokesperson said: "India is an important market for Ford, with more than 16,000 employees, as well as being a source of our global powertrains for Ranger," the person said. "We are continuing to assess our capital allocations and expect to have an answer in the second half of the year. We have nothing additional to share at this point."
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