Ford likely to press pause on India plans, re-evaluate strategy

According to a senior official familiar with the matter, the company’s board discussed the situation in January and decided not to make any announcements at this time.

Ford Motor Company, which announced its return to India last September, is now reconsidering its plans, delaying its much-anticipated January announcement on its India strategy. Sources told The Economic Times that the American automaker is re-evaluating its move and will not reveal a final decision until late summer.

According to a senior official familiar with the matter, the company’s board discussed the situation in January and decided not to make any announcements at this time. "There is definitely a delay, and the company is using the time to rethink its India strategy," the official told Times of India.

When contacted, a Ford spokesperson reiterated the company’s commitment to using its manufacturing capabilities in Chennai to serve global markets, as quoted by ET. Moneycontrol could not independently verify the report.

Multiple factors are contributing to the delay, sources told Times of India. One key issue is the shifting political landscape in the United States, where there is growing pressure on automakers to prioritise domestic manufacturing. This push towards "Made in America" products could make large foreign investments, like Ford’s India revival, less attractive.

Another concern is the condition of Ford's Chennai plant, located in Maraimalainagar, which requires significant upgrades. Retrofitting the plant for electric vehicle (EV) production could cost between $100 million and $300 million, a hefty investment in light of the current volatility in the global EV market, according to The Economic Times.

Ford had initially expressed strong commitment to its India plans, with Kay Hart, president of Ford International Markets Group, noting the importance of the Chennai plant in the company’s global export strategy. However, even the Tamil Nadu government had previously noted that Ford’s India plans were still fluid, the report adds.