Ford’s small car next year

Michael Boneham, MD and president of Ford India, told that the company's expansion plans were going ahead "as scheduled". The US auto major - that posted a record $14.7 billion net loss in 2008 globally - had announced the half-a-billion dollar investment for India last year to double annual production capacity to 2 lakh units and make 2.5 lakh petrol and diesel engines.

FORDS STEPS IN
"The last six months have been tough for the auto industry.... and we maintain a cautious outlook for the rest of 2009,"Boneham said, adding that he expected a turnaround only by 2010." And this will be the time when we bring in our small car. Thus, we are confident it will get a good response," he added.

TOUGH COMPETITION
The company is making efforts to ensure that its new small car, that is being designed and engineered for the Indian market, is attractively priced considering it faces tough competition from players like Maruti Suzuki, Hyundai and Tata. "It will be the first offering from Ford in the mass market segment and we are making efforts to keep it cost-competitive while making it a great value proposition," he said.

Ford currently sells sedans like Ikon and Fiesta in India apart from the SUV Endeavour and has seen sales shrinking 19 per cent in April-February 2009 period at 24,849 units (year-on-year). Boneham said he expected numbers to turn positive once the small car hits the market.

Ford's car would come with petrol and diesel engines, both falling within the small car definition of the government to avail lower excise benefits-petrol engine under 1200cc and diesel under 1500cc with overall length below four metres.

KEEN ON DOMESTIC MARKET
Asked whether the company had plans to export the model, Boneham said it would certainly be sold abroad, though the initial focus would be on the domestic market. "Yes, we would look at markets beyond India and these would be countries in the Asian region, South Africa as well as Asia-Pacific area," Boneham said.

And in the run-up to the car's launch, the American company is beefing up sales and service network in Tier-2 and Tier-3 cities while also working on relationships with banks for broadening retail finance options.