Ford is one of the famous vehicle manufacturing companies and it has promised that a restructuring of its business in India the business will result in 2 plans in Chennai as well as in Sanad and soon will be shut down by the second quarter of next upcoming year. This does not mean that there will be an end of services by the company and after-sales support for roughly 10 lakh customers that it has in India. Well, the company’s 300 – odd dealership will remain open for service.
Anurag Mehrotra the MD and President of Ford India spoke about their new strategy by saying “This is a very difficult decision. No matter what we tried and investigated, all of our projections show we will continue to give some optimal returns to shareholders and investors. There was no other option but to the structure.” Food is making the decision to consider several options including partnerships, platform sharing, contract manufacturing with all the other makers, and the possibility of selling its manufacturing plants which are still under consideration. Mehrotra further said “Despite these efforts, we have not been able to find a sustainable path forward to long-term profitability that includes in-country vehicle manufacturing.” Due to this decision around 4000 odd- permanent employees of Ford India will move out and the company has also said “Ford will work closely with employes, Unions, suppliers, dealers, government and other stakeholders in Chennai and Sanand and to develop a fair and balanced plan to mitigate the effects of the decision.”
Apart from the jobs at the Ford company of over 40,000 employees, the company’s retail points will also face the threat of getting unemployed and the dealers fear this. The president of dealers Association FADA, Vinkesh Gulati has invested around rupees 2000 crore towards retail and service infrastructure and said “The retail fraternity is really shocked by Ford’s announcement where it has said that it will shut down production.” Thursday’s announcement finally brought to it and Ford was open about how it is able to grow in a market where others such as Maruti, Hyundai, Tata Motors, and Mahindra are reaped in dividends.
Well, the newcomers in the industry including Korean Kia and China’s MG motors managed to get a very grand opening despite starting late in 2019. To date, Ford loses at $ 2 billion and the exit carries for the cash outgo for the company which is around $ 1.7 billion including various settlements apart from $ 0.3 billion non-cash charges. However, the food business solutions will be continued in India and it employs 11,000 members engaged in software development as well as data science and R&D including finance and accounting. The closer will come after a last-ditch effort to forge a JV with M&M