Electric vehicle: Ford abandons plans to manufacture electric vehicles in India

US carmaker Ford has dropped plans to manufacture electric vehicles in India for global markets.

The Indian management of the US automaker announced this to the employees at the Chennai plant on Thursday.

Ford India was among 20 different companies selected under the Government of India’s Production Linked Incentive Scheme announced in February 2022. But it can now withdraw its bid as it will no longer invest in the country.

Those in the know say that the business case failed to meet the volume forecast and internal targets, which is why the decision was made to drop the plans.

The company is expected to go ahead with its original plans to sell its factories in Sanand, Gujarat and Chennai. Production at both plants was discontinued. While talks with Tata Motors to sell its Sanand plant are progressing well, it is still pursuing several interested parties for its Chennai plant, insiders say.

In an official response, the Ford India spokesman confirmed, saying: “After careful consideration, we have decided not to pursue the manufacture of electric vehicles for export from Indian plants. We remain grateful to the Government for approving our proposal under the production-linked incentive and supporting it as we continue our exploration.”

After announcing the exit in September 2021, the US automaker applied to participate in the Indian government’s PLI program.

As part of the ongoing business restructuring in India, Ford had continued to explore possible alternatives for its manufacturing facilities; The spokesman said this included applying for the production-linked incentive scheme, which allowed us to explore using one of the plants as a potential electric vehicle production base.

“Ford India’s previously announced corporate restructuring is proceeding as planned, including exploring other alternatives for our manufacturing facilities. We continue to work closely with unions and other stakeholders to come up with a fair and balanced plan to mitigate the impact of the restructuring,” the spokesman added.

Cheryl Tenny

"Thinker. Food advocate. Incurable coffee enthusiast. Communicator. Proud student. Zombie buff. Tv fanatic. Extreme troublemaker."

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