Tuesday, February 25, 2014
By Kamal Swami
Ford working 24x7 to bridge gap between demand and supply
The Indian car industry is in the middle of a downturn, but Ford Motor's Indian unit is planning a round-the-clock manufacturing programme at its Chennai plant to meet local as well as overseas demand for its compact SUV EcoSport. The plant will operate 24 hours from the second half of 2014, a first in Ford's 17-year presence in India. The company plans to produce 1,60,000 units in 2014 by operating the plant in three shifts. The plan is to take it to 2,00,000 cars with vendors' support. Ford India will, thus, join its South Korean rival Hyundai — also at Chennai plant — in operating with three shifts.
Ford currently makes about 350 units of EcoSport a day. It plans to increase it to 450 units per day by June. By October, the plant will produce 750 to 850 units a day to meet demand from Europe and Japan. Ford India is working with vendors to ramp up their capacity to meet the high demand. The move comes at a time when block closures have become a norm due to a declining market. Ford India spokeswoman said the company continues to evaluate opportunities to remove bottlenecks for reducing the waiting period. "Given the dynamic and challenging times across the industry and low consumer sentiment, we continue to monitor the situation and will adjust our production to match the demand for our products. We do not comment on specific production volumes," the spokeswoman said.
After the launch of EcoSport at an aggressive price, Ford India garnered massive bookings of over 60,000 units; the company delivered 35,000 units by January. While it is good news for the company , its inability to deliver more vehicles is leading to a lot of frustration among the waiting customers . In fact, some of them have been compelled to pay Rs 1 lakh more after paying the booking amount, as Ford India has made two price increases in the last 9-12 months. "I don't think they will be happy, but the responses have been overwhelming. We are looking at how to enhance the capacity. Price changes have been driven due to macro-economic environment and we are in touch with each of the customers and there is enough transparency," said Tom Chackalackal, ED, manufacturing, Ford India.
Source: Ecnomic Times