Ford of India Profitable for First Time Ever: Report

After 23 years in India, Ford has finally turned a profit in the market.

byJames Gilboy|
Ford News photo

Ford's India market branch has reportedly achieved a profit during the 2017-2018 fiscal year, marking the first time the automaker has managed this feat in the populous Asian nation since entering it in 1995, according to Live Mint.

Ford reportedly managed this record despite a small sales volume in the country. Sales throughout September were just under 20,000 and that was enough to set a record for that month. Much of these sales were exported vehicles, which made up 58.7 percent of Ford India's sales volume for the month. For reference, Ford's sales over the same period in the U.S. totaled 197,404.

Ford reportedly considers India a place to try its Emerging Market Operating Model, which emphasizes cost-cutting to make its vehicles affordable to developing markets. This program involves local partnerships, platform-sharing, outsourcing, and has reportedly grown Ford India's revenue by more than 60 percent between the 2015-16 and 2017-18 fiscal years, from $2.1 billion to $3.4 billion.

EMOM has reportedly reduced divisional spending by 40 percent and can continue operating almost independently of mothership Ford, which has granted the India wing more autonomy than its branches in more established markets.

One example of a significant local partnership Ford enjoys is with Indian automaker Mahindra, the world's largest manufacturer of tractors. The two are planning a pair of SUVs and a compact electric vehicle for the Indian market. The SUVs are also planned as an export model for other growing markets. Because of India's unrefined infrastructure in some areas, rugged vehicles are of greater value there than in many first-world countries, as The Drive's Alex Roy discovered on his adventure across the country.