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Ford India: How much longer a one-trick pony?

Ford Credit in India, which gives car loans, may be a one-trick pony, financing only one automaker Ford and the only product it sells in the country.

But it does the trick well.

The automaker, Ford, is now just half a day's production away from surpassing General Motors Corp as the world's largest auto producer.

And the one product it sells in India has grabbed 22 per cent of India's mid-size car market.

Ford sold 17,402 of its mid-sized Ikon cars in India last year, and another 6,489 through the first four months of 2001.

Ford Credit plays a key role in helping grease sales -- or "move the metal" in industry slang - in low-income countries like India.

"I can structure a repayment plan that is the same as a Santro," Ford Credit's head, Michael Wagner said, referring to a cheaper, smaller car produced by the Korean automaker Hyundai.

The Ikon costs anywhere from Rs 550,000 for the 1.3-litre engine model with 'low-level trim', to Rs 700,000 for the 1.6-litre engine model with lots of bells and whistles.

The top-selling version is the perky 1.6-litre, petrol-powered model, referred to within Ford India as the 'josh machine'. Josh in Hindi means 'full of life, vitality, full of fun'.

Wagner said the typical buyer of the 'josh machine' is a thirty something, male salaried employee of a large Indian or foreign company.

"It's an affordable car for them and has the performance they like."

The Ikon competes with GM's Opel Corsa, Fiat's Siena, Hyundai Motor's Accent and the Esteem, the mid-size car made by Maruti Udyog Ltd, a joint venture between Suzuki Motors and the Indian government.

Chaffeur-driven escort

Ford began operating in India just five years ago, originally selling a locally assembled version of the Escort.

Costing more than the Ikon, the Escort was purchased primarily as a chauffeur-driven automobile, narrowing the pool of potential buyers.

Ford's sales in India picked up substantially after it launched the Ikon in late 1999.

The car is assembled at a plant in Madras, which is now nearing its current capacity of 50,000 vehicles a year.

That has aroused interest in whether Ford may soon move to expand its production capacity in India, especially as it expands exports from there to markets in Latin America, South Africa and possibly elsewhere in Asia.

One product?

Phil Spender, president and managing director of Ford India, said in April the auto maker aimed to ship 40,000 cars from the Madras plant during the current Indian financial year to next March, half of which would be exported.

Eighty per cent of Ford India's car exports now go to Mexico and the rest to South Africa.

"These are the first two markets that we have targeted. They are very similar in profile to India, climatically and socio-economically," Spender said.

He also said Ford was exploring export markets in South America and South East Asia, and may begin selling another model in India.

"We will not remain a single product company for long," the Ford India chief said, but declined to elaborate.

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