The government recently announced that 20 companies, including four-wheeler manufacturers, two-wheeler companies and new entrants like Ola Electric Technologies have been selected to receive incentives under the Production-Linked Incentive (PLI) scheme for the Indian automotive sector. What sprung a surprise was seeing Ford India’s name in the list as the US-based company had announced in September last year that they have ceased manufacturing vehicles in India due to accumulated losses of over $2 billion in the last 10 years. So, does this mean Ford is scripting a comeback?
Before reports start to spiral out of control, in a statement, Kapil Sharma, Head of Communications and CSR, Ford India, said, “We thank the Government of India for approving Ford’s proposal under the Production-Linked Incentive (PLI) scheme for the automobile sector. As Ford leads customers through the global electric-vehicle revolution, we’re exploring the possibility of using a plant in India as an export base for EV manufacturing. We don’t have anything additional to announce at this time.”
With Ford looking at manufacturing and exporting EVs as a viable option in India, the question arises, which plant will they use to roll out the new EVs as the company had stated last year that they ‘will wind down vehicle assembly in Sanand (Gujarat) by the fourth quarter of 2021 and vehicle and engine manufacturing in Chennai by the second quarter of 2022’. With Ford India not being able to run both the plants, everything will come down to brass tacks.
Last year, Ford Motor had announced an investment of $30 billion for its electric lineup and battery development strategy and India may play an important role in manufacturing affordable EVs with the rebates under the PLI scheme. Ford wants 40% of its vehicles to be electric by 2030 globally and India could help them achieve this by becoming an export hub for them. As expected, Ford India is playing it close their chest, but the company hasn’t ruled out the possibility of selling these locally manufactured EVs in India.
The PLI scheme offers an incentive of up to 18 per cent in the automotive sector to bring in fresh investment in the indigenous supply chain of advanced automotive technology (AAT) products.
