General Motors Company (GM): Ford Motor Company (F) Makes a Big Shift in Asia

The solution: build popular models for other ready markets
“Despite current macroeconomic factors and ongoing market challenges, India is a big part of our global strategy,” Ford’s Asia Pacific chief Dave Schoch said in a statement on Wednesday. “Exports from India have always been an integral part of that strategy and will help us to stay on track for turbocharged growth in the region, while going further to provide our customers with the vehicles that they want and value.”

Or put another way, Ford is committed to making vehicles in India, but the reality of the market right now means that Ford will be exporting the majority of them.

That’s not necessarily a bad thing, given the relatively low cost of production in India. Ford is likely to find plenty of willing customers in Asia for vehicles like the Fiesta and the EcoSport. The company didn’t give specifics on where they’d be going, but did say that its Indian facilities would be exporting to “more than 50 markets around the world”.

One safe bet is that finished vehicles won’t be exported to China (though engines and other parts might be), because of the big tariffs China places on imported cars and trucks. But they could go to markets throughout Asia, and possibly Africa and Australia as well.

The upshot: another victory for “One Ford”
Long story short, this is the “One Ford” strategy at work. Ford’s flexible assembly lines – and its lineup of genuinely global models and platforms – mean that excess capacity can be profitably put to work helping to support sales growth elsewhere in the world.

Ford Motor Company (NYSE:F)’s struggles in India haven’t been encouraging. But the fact that the company is recognizing the struggles, and is able to put its shiny new Indian factories to work serving other markets, is a good sign for Ford shareholders.

The article Ford Makes a Big Shift in Asia originally appeared on Fool.com and is written by John Rosevear.

Fool contributor John Rosevear owns shares of Ford and General Motors. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford.

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