Ford Motor is contemplating a revival of its long-standing partnership with Tamil Nadu, India, which could lead to the resumption of vehicle production in the region. Chief Minister MK Stalin announced discussions with Ford, hinting at a potential restart of operations at the Chennai plant.
Ford halted production for the domestic market in India in 2021 due to low volumes and discontinued exports in 2022. This marked the end of its direct involvement in one of the world’s largest car markets, dominated by Asian competitors.
In 2023, Ford sold one of its two Indian plants to Tata Motors, while the Chennai facility was closed. Despite this, there’s renewed interest in leveraging Tamil Nadu’s manufacturing capabilities for global exports.
MK Stalin highlighted the potential of renewing Ford’s three-decade-old partnership with Tamil Nadu, aiming to produce vehicles for the international market once again. This move could be a strategic shift for Ford, which had struggled to maintain profitability in India.
Ford’s previous foray into the Indian market included producing models like the EcoSport and Endeavour SUVs. However, with less than a 2% market share, the company faced significant financial losses exceeding $2 billion over a decade.
The company’s decision to exit followed the collapse of a joint venture agreement with Mahindra & Mahindra, which would have helped Ford reduce production costs in India. Despite this, Ford continues to operate in India, producing engines for its Ranger pickup trucks and sourcing parts locally.
The discussions between Ford and Tamil Nadu suggest a potential new chapter for the automaker in India, focusing on exporting vehicles rather than competing in the domestic market. This development could reshape Ford’s strategy in the region and strengthen its global operations.
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