Ford’s India operations close to posting profit this fiscal

MUMBAI: Ford Motor’s India is close to posting a net profit, driven by strong gains in domestic sales and booming exports that helped the automaker’s local unit post a 20% expansion in turnover for the third consecutive year.

In fiscal 2018, Ford India’s domestic operations crossed a billion dollars in turnover for the first time. Exports accounted 2.4 times local sales, taking the total turnover to $3.4 billion.

The company has been making an operational profit in India since fiscal 2014 and, according to people in the know. It was around the breakeven level in the year ended March 2018 and may post a net profit in the current fiscal year, they said. Ford India executives refused comment on the fiscal 2018 bottom line, which it has yet to report to regulators, and the estimate for the current year.

For a company that has been a fringe player in India’s automobile market and reporting losses year after year — the accumulated India losses were Rs 3,487 crore at the end of FY17— the performance in the past few years has been remarkable. That, at a time when rival General Motors has shut its India operations due to weak sales mounting losses.

Ford India last posted a net profit in fiscal 2009, of about Rs 19 crore. With continuing losses since raising doubts about its existence here, Ford launched an initiative to correct the fundamentals of cost, capacity utilisation and the brand.

The Emerging Market Operating Model (EMOM) mooted by Ford Motor in 2016 focuses on every aspect of the business, right from administration to marketing and distribution, to bring down cost to the levels that can help it compete with the likes of Maruti Suzuki and Hyundai.

Ford India Limited