Car maker Ford’s India strategy is on the right-track despite a slowing economy, asserts its President and Managing Director Michael Boneham, who believes that transparency in policy and positive consumer sentiment will go a long way in boosting the industry.
The company has decided to make a mark in the small car segment, with high levels of localisation , in addition to maintaining its domestic and export strategy for vehicles and engines. “The decision to enter the small car category is mainly because we see a vast majority of people who are graduating from two-wheelers to four-wheelers as a result of GDP and purchasing power parity improvements. A lot of our future launches will be in this segment. This is also the area where 70 per cent of all cars are sold, and we don’t expect this mix to change in the future,’’ he said, in an interaction with The Hindu at the company’s plant here on Monday. He went on to add: “Our export strategy will provide a nice hedge for us, and allow us to respond flexibly to global conditions.” To a question, he said “what we really need, however, at this point is transparency in policy. We can’t have sudden taxes on diesel cars; it would become a major issue for us. Secondly, consumers have to get over their negative mindset, which has become like a wall of worry due to rising inflation. If we see Europe pick up, it will help India and other countries,”
On the decision of the RBI to keep key interest rates unchanged, Mr. Boneham said the move was understandable in light of spiralling inflation. “While I would have liked to see a drop in interest rates, it makes sense as to why the central bank decided not to. However, with regard to the CRR cut, I think it’s a very positive move. By freeing up cash … the banks will make it more accessible to the consumers.
“As we know, 70 per cent of our car purchases are financed in this way,” he said.
Asked whether the recent ‘big-bang’ reforms gave off the right signals to the industry at large, Mr. Boneham came out strongly in favour of the decision. “Last week was a first step forward. What we need as industry and company is stability in policy-making. Not knee-jerk changes. Right now, we need transparency and consistency, and open debate and discussion about it as we move forward,” he said.
