Ford to Produce Small Cars in India

Ford Motor Co is set to take a bigger piece of the Indian car market, as it announced it will launch a new model in India every 12-15 months over the next five years. Ford also hopes its new Figo small car will help triple its sales in 2010.

Ford’s plan is to benefit from India’s low-cost facilities in order to grow in the small car segment, which is expected to hit up to 60 percent of all global car sales in 10 years. The American company also takes in consideration that 70 percent of the 1.5 million cars sold in India belong to the small-car segment, so this will also be a very important market, autonews.com reported.

"If you want to be in the game here in India, you have got to be in that segment. If not, you'll be an interesting niche player, not a mainstream player," Michael Boneham, Ford Motor India's president, said at the Reuters India Investment Summit. “And Ford wants to be a mainstream player here."

According to Boneham, Ford expects to sell 31,000 cars here in 2009 and says it would be "a reasonable expectation" for this number to triple in 2010, once the Figo model arrives in India.

Future plans also include Ford's plant in the southern Indian city of Chennai, which is set to double capacity to 200,000 units annually at a cost of $500 million. At the beginning of 2010, the plant will be able to produce 250,000 diesel engines annually.