Ford India announces $1billion plant in Gujarat

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Ford Motor Company has announced that it will build an integrated manufacturing facility comprising of a state-of-the-art vehicle manufacturing facility and an engine plant in Sanand, Gujarat. The company has signed an MoU with the government of Gujarat for the same. Ford will invest approximately 4,000 crore in the two facilities, which include stamping, body, paint and assembly operations for vehicle manufacturing, as well as machining and assembly operations for engine manufacturing. The vehicle manufacturing plant will have an initial annual capacity of 240,000 units, and the engine plant will have an initial annual capacity of 270,000 engines. Ford’s investment will also create 5,000 jobs at the new facilities.

Construction of both plants will begin later this year, with the first vehicle and engine scheduled to come off the line in 2014. In 2010, Ford announced it would bring eight new vehicles to India by mid-decade. Ford currently has a vehicle manufacturing plant in Tamil Nadu and is expanding its engine plant there.

Ford is bringing more than 50 new vehicles and powertrains to its Asia Pacific and Africa region by mid-decade. Sixty to seventy percent of Ford’s growth is expected to come from this region over the next ten years.

“This is an investment in the future of Ford globally,” said Joe Hinrichs, president and CEO of Ford Asia Pacific and Africa. “These new state-of-the-art facilities will help us reach the goal ofincreasing worldwide sales by nearly 50 percent by mid-decade to about 8 million vehicles per year. We are aggressively expanding in markets around the world that have the most growth potential, in order to offer more of the fuel-efficient, high-quality vehicles from our global portfolio that customers in markets like India want and value.”

Mr. Narendra Modi stated in his address, “Entry of Ford Motor Company in the State will further strengthen the capability of Gujarat as an auto hub.” He emphasized, true to the spirit of Gujarat, “I further assure Ford the wholehearted support and hand-holding of my government for the speedy implementation of the project.”

This additional investment brings Ford’s total investment in India to approximately US$2 billion.  Ford recently announced an investment of US$72 million by 2012 to expand its powertrain facility in Chennai to further support its expansion in India. Ford India has also recently increased its sales and service network to 190 outlets across 108 cities, of which more than 40 percent are located in secondary markets.

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