Exports of made-in-India Ford vehicles and engines helped the company in this regard.
US-based auto major Ford exited the domestic Indian market for good in FY22 (April 2021-March 2022). However, exports of vehicles and engines has helpedit post a Rs 505 crore profit in FY23 (April 2022-March 2023).
- Ford manufactured vehicles in India until July 2022
- Sold 17,219 cars and 1.7 lakh engines in FY2023
- Carmaker sold its Sanand plant to Tata in January 2023
During the financial year 2022-23, the revenues of the company from the operations stood at Rs 7,079 crore, a 31 percent fall over FY22 revenues. The total expenses for the fiscal were reported as Rs 9,607 crore, stated the directors’ report sourced from business analytics firm Tofler.
In its 28th annual report, Ford India’s director report noted that the financial performance for FY23 was largely impacted by the restructuring decision announced in September 2021. The decision resulted in an exit from vehicle and engine manufacturing operations at Chennai and vehicle manufacturing operations at Sanand.
Ford India sales
“The total revenue from operations included domestic sales of Rs 980 crore and export sales of Rs 6,099 crore – 59 percent and 22 percent lower than the previous year’s Rs 2,399 crore and Rs 7,802 crore, respectively,” stated the directors’ note.
In terms of volume, Ford India sold 17,219 cars and 1,77,864 engines during the financial year under review, as compared to 69,223 cars and 82,067 engines in the prior financial year, a 75 percent decrease in vehicle sales and 117 percent increase towards engines.
“The Company made a Profit after Tax including exceptional items of Rs 505 crore as against previous year’s net loss of Rs 4,226 crore primarily driven by a decrease on account of restructuring expenses and higher engine volume sales,” added the Directors’ note.
Sanand plant sold to Tata Motors in FY23
Tata Passenger Electric Mobility Limited (TPEML), a subsidiary of Tata Motors Ltd (TML), acquired Ford India Private Limited’s vehicle manufacturing plant in Sanand, Gujarat on January 10, 2023.
“Both companies sought to ensure continued employment for all vehicle manufacturing plant workmen by allowing them the opportunity to accept the transfer of employment to TPEML with continuity of service,” said the report in its review.
Ford India continues to operate the Sanand Powertrain Manufacturing Facility by leasing back the land and buildings of the Powertrain Manufacturing Plant from TPEML on mutually agreed terms.
The company is also wooing multiple potential suitors for its Maraimalai Nagar plant. People in the know say that the company has recently engaged with Vietnamese carmaker VinFast and JSW Group for a potential sale.
Could Ford re-enter the market?
Given that the company has been able to make profits, it may be keeping the door open for its re-entry at the top end of EVs in the coming years, as the global markets continue to struggle with a fall in volumes.
In September 2021, Ford India announced it would stop production in India due to growing losses and no visibility of the path to profitability. In February 2022, the company stated it was exploring production of EVs, but this was dropped by May 2022. Ford finally stopped producing vehicles in July 2022 when the last EcoSport SUV rolled off its Chennai production line, meant for export markets.
After Ford’s Chennai plant was closed, the workers’ union and Ford India negotiated for a severance package in September 2022, paving the way for an easier exit, as against the challenges-ridden path adopted by its rival General Motors in the country.
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