By IANS
Chennai : Automaker Ford India Pvt Ltd will soon roll out a small car for the Indian market and produce engines for the Asia-Pacific market by investing $500 million, said a top official.
“Ford India will invest $500 million on these two projects. The funding will be a mix of equity from Ford Motor Co of the US and debt from Indian banks,” Arvind Mathew, managing director and president of the company, told the media here Tuesday.
The company will set up a 250,000-unit per annum integrated engine plant at Maraimalainagar near here, mainly for the Asia Pacific market, and produce a small car mainly for the Indian market.
Mathew said the two projects would go on stream in 2010.
He discounted the possibility of Ford India importing the small car in a semi-knocked down condition from its Thailand facility or any other facility till its new plant starts production.
With the proposed investment in place, Ford India’s total vehicle production capacity will double to 200,000 units a year.
“The integrated diesel engine plant is the first plant for Ford Motors outside Europe. The proposed investment in India is the third major announcement made by the company in the Asia-Pacific and Africa region,” said John Parker, executive vice-president, Asia Pacific and Africa, Ford Motors.
The American automobile company had earlier announced an investment of $500 million in Thailand for making small cars. It has also invested $510 million in China.
Parker said the proposed Indian investment highlights the significance of India’s role in the company’s continued expansion and overall strategy for the Asia-Pacific region.
With the announced new investment, Ford Motor’s total investment in India will be $875 million.
According to Mathew, the proposed plant will make both diesel and petrol engines of varied capacities.
Presently Ford India is building a new 50,000-unit per annum diesel engine assembly plant at Maraimalainagar.
“The first engine will be rolled out of the new line in April this year. The assembled engines will be fitted in Fiesta and Fusion models. The assembly line will be integrated with the proposed integrated engine plant,” Mathew added.
The new facilities and the capacity expansion are expected to generate 1,500 additional direct jobs.
Domestic auto component vendors, too, have to expand their capacity matching Ford’s expansion.
During 2007 Ford India produced around 45,000 units. “We are a profitable company,” Mathew said.