Used car imports will destroy domestic auto industry - Spender

By Our Special Correspondent

CHENNAI, OCT. 4. With too many competitors vying for insufficient volume, the Managing Director of Ford India, Mr. Phil Spender, is convinced that a consolidation in the domestic industry will necessarily have to follow global path.

In a chat with select presspersons here today, Mr. Spender, nevertheless, rued that the consolidation was taking its own time. ``It is taking longer for a shake-out to occur in India,'' he said.

Quizzed as to how he felt when Ford called off its bid for Daewoo, the MD merely said, ``I have no comment.'' Nevertheless, he sort of concurred that Ford India at least had very little option at the moment to contemplate any inorganic growth route for itself. Queried further, he suggested that ``Ford in India is very much in final shape''.

On the one hand, General Motors has just announced an equity increase in Suzuki which is a joint venture partner in Maruti Udyog (MUL). It also has a significant holding in Fiat Auto, the parent company. The Daewoo bid is off. That leaves only Indica maker Telco which has no partner at the moment. On the face of it, as suggested by Mr. Spender, Ford India appears to have little leeway in terms of options in the sub-continent.

Nevertheless, the MD drew pointed reference to the parent company's presence across the globe and its ability to design and produce products to suit local needs.

To a question, he reiterated the multinational's known stand on import of the second-hand cars. He declared that Ford India was against import of second-hand cars as it ``will destroy the domestic automobile industry''. More than letting the consumer have a choice, the second-hand car import involved larger social issues such as environment pollution and job opportunities, he pointed out. In the same breadth, he said niche import of new cars at the top end especially ``is a good thing'' and would help the industry here to be competitive.

Fielding an assortment of questions, the Ford MD ruled out any move to hike Ikon prices in the wake of oil price revisions.

Ford sold 1817 units of Ikon during September, registering 22 per cent growth over August. Since launch of the Ikon, the company has sold over 16,000 cars. The company has sold 14418 cars in the current calendar year alone, claming a market share of 22 per cent in the mid-size car segment. Mr. Spender said Ford India had set a sales target of 21,000 cars for the current year.

Mr. Vinay Piparsania, General Manager (Sales), said 38 per cent of sales came from the South, 33 per cent from the North and 29 per cent from the West. According to the Ford MD, the ``hottest selling'' Ikon product is 1.6 Zxi model. The 1.3 petrol model comprised 35 per cent of Ford's total sales. The 1.8 diesel version constituted 20 per cent of the sales.

Asked about export plans, the MD indicated than an announcement would come on this score by year-end. Quizzed on the much talked about Ford proposal to make engines in India, the Managing Director said ``We are still looking at it. There is however no firm plan as yet.''

Send this article to Friends by E-Mail

Section  : Business
Previous : Italian machine tool makers seek Govt. support
Next     : Banking 'Godzilla' with big assets, and biggest
           debt