Ford might reenter India with EVs
Hyderabad Just months after the US automaker Ford Motor Co decided to stop selling and manufacturing cars in the country, has said it is considering producing electric vehicles (EVs) in India for export, and possibly for sale in the domestic market.
There appears to be a shift in the company's strategy after it said in September it was taking a hit of about $2 billion because it does not see a path to profitability and was leaving the major auto market. The decision had come as a setback for Centre's "Make in India" campaign.
Ford has two car plants in the country. It was "exploring the possibility of using a plant in India as an export base for EV manufacturing," a company statement said.
"There have been no specific discussions on this right now, but it is not out of the realm of future consideration," a company spokesman said.
The automaker had said it plans to invest $30 billion in EVs and batteries through 2030.
"There is a cost benefit to manufacturing in India, and the company has historically exported vehicles to North America and Europe - both of which are now large and growing EV markets," said Vangaal, Associate Director, Light Production Forecast, IHS MarkiT.
"Ford will have to prove India can also be cost-competitive for making EVs, for which it will need big investments to localise the supply chain," he said, adding that it will also need to figure out how it would source lithium-ion batteries.
Ford's move to explore India as EV manufacturing hub came after the company's proposal to seek incentives under the government's $3.5 billion scheme for clean-fuel vehicles was approved recently.
The company's strategy is commensurate with the Centre's agenda to cut oil imports and reduce pollution by giving benefits of up to 18 per cent of new investments made by companies to manufacture electric and hydrogen fuel-powered vehicles. The US automaker is among the 20 other companies eligible for benefits under the scheme.