Ford decides to close its plants in India
New Delhi: American car manufacturing company Ford has stopped its production of cars and SUVs in India.
The company has announced that it will stop manufacturing vehicles for local sale and closure of its Sanand and Maraimalai Nagar plants by 2021 and the Chennai engine and vehicle plant by 2022.
Many reasons for wining its operations in India. The main reason is that plant capacity utilisation has been unsustainably low. Combined, the two plants have the capacity of producing 4,00,000 cars annually. However, Ford has managed to make 80,000 cars annually.
Jim Farley, Ford Motor Company’s president and CEO, said that “despite investing significantly in India, Ford has accumulated more than $2 billion of operating losses over the past 10 years and demand for new vehicles has been much weaker than forecast.”
Ford says that about 4000 employees' future will be affected by its decision of closure of two units. The company will be working out fair settlement of its employees after consultation with unions and all stakeholders.
