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Asia:Ford expects $100 million auto parts exports from India

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Reuters / July 01, 2003

NEW DELHI, India -- Indian auto parts suppliers to Ford Motor Co.'s local unit could export components worth $100 million a year to its global plants to meet a growing need for cheaper assemblies, a Ford official said Tuesday.

Currently, 96 Indian companies supply auto parts to Ford India Ltd., which makes the Ikon sedan at a plant on the outskirts of the southern city of Madras.

Only 10 of them, including Amara Raja Batteries Ltd., SKF Bearings Ltd and Wheels India Ltd., were certified to bid to supply to Ford's global plants this year.

"There is potential to supply $100 million of components year over year with the current development of the Indian supply base," Vinay Piparsania, director of sales operations at Ford India, told Reuters on the phone from Madras.

Piparsania said there was huge potential to export from India because Ford's global sales are much larger than India's entire car market.

Ford has developed a large pool of vendors in India because the cheaper parts help reduce prices and boost volumes.

"We are in the process of establishing 12 more vendors by the end of the year," Piparsania said.

Several global automakers such as Volvo and DaimlerChrysler have made their way to India over the past six months as they shopped for low-cost, high-quality parts.

Industry officials say Indian auto parts are about 15 percent to 20 percent cheaper than those from Western suppliers.

Ford India expects sales of about 20,000 cars in the domestic market and a similar number for exports in knocked-down form. It sold 14,970 cars in 2002 and exported 28,915 completely knocked-down kits.

Ford India's car models are positioned in India's mid-sized car segment, which accounts for 18 percent of all new-car sales of nearly 542,000 units a year.
 
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