American automaker Ford is mulling closure of its manufacturing facilities in India, a report said. The company is reportedly in talks with other automobile companies for contract manufacturing or the sale of its Maraimalai Nagar and Sanand factories.
Ola has emerged as a frontrunner for taking over the factories for contract manufacturing of its electric vehicles, according to the report.
"We would not like to comment on speculations. We continue to assess our capital allocations in India and expect to have an answer in the second half of this year,” said a Ford India spokesperson told Times of India.
Ford was previously involved in a joint venture with Mahindra and Mahindra that was enacted in October 2019. However, the deal was called off in January this year.
Ford’s two factories in Tamil Nadu and Gujarat have a total manufacturing capacity of four lakh units. The ailing automobile firm had been looking for other companies to lease out its factories for contract manufacturing. It had been holding discussions with companies like MG, Chegan, and others but talks fell through.
Reports suggest that Ola and Citreon have emerged as front runners as potential partners for Ford’s operations in India.
Ola, the ridesharing and services company, had recently announced that it would be foraying into the manufacturing of electric vehicles in the country. Citreon, an old established name in automobile manufacturing, is a new player in the Indian car manufacturing sector.
Ford’s sales have been declining steadily with the company only managing to sell 2,790 units in June this year, compared to 2,872 units in June 2020. The company’s portfolio has also been decreasing in size over the years, with the Ford EcoSport leading most of the sales for the company.
(Edited by : Kanishka Sarkar)