Ford India Case Study

• Ford is a small player in India, which is not good news as auto sales in this market are expected to double by 2020.

• Ford, however, has been slightly successful in increasing market share in India of late on the back of new product launches, and it is trying to sustain this momentum.

• Ford is looking to make spares cheaper, introduce more sub-parts, and increase affordability of spares in order to further increase sales in India.

Ford: Trying to Be Big In This Growth Market

In a recent article on Ford (F), I had focused on how the company’s focus on the SUV segment in two of the fastest growing automotive markets in the world will allow it to improve its margin performance in the long run. In fact, Ford's Asia Pacific President Dave Schoch

Let’s see if the company is doing enough to tap the opportunity.

A closer look at 2016

Ford India has been performing well this year. In February, it sold 17,306 units, up 37.61% from 12,576 units sold last year. The growth in sales was driven by exports which have been the focus of auto majors in India in the recent past. Global auto majors like Ford, GM (GM) and Volkswagen (VLKAY) are investing heavily in the country. However, these carmakers aren't up to the mark in the Indian market so they are focusing more on exports.

For instance, Ford’s domestic sales have been flat at best this year. In fact, Ford saw a decline of 8% in domestic sales in the month of February in India. The Blue Oval sold 5,483 units last month in India compared to 5,959 units last year. The domestic market share of Ford has been moving within the 2% to 4% range all through this fiscal year. Ford still remains in the bottom rungs of the Indian car industry with an average market share of

The U.S.-based car maker is bringing in major changes in its sales & marketing strategy for India as it looks to change itself into a big player in this market.

Ford has identified certain key areas that need to be addressed in order to increase its sales and maintain customer loyalty. The first area is product-led innovation. As a part of this plan, Ford’s new models for the Indian market have been equipped with new features in order to make its vehicles more attractive to buyers. For instance, Ford has equipped the Figo Aspire with cruise control and also deployed semi-assisted self-parking in the Endeavour, which are segment-first features in India.

Another area to be addressed as identified by Ford India is the cost of spare parts, components, and maintenance. Ford is still perceived to be expensive to maintain in India, and the Indian customer likes cheap maintenance a lot. As a result, Ford has improved the maintaining ability of its new models by increasing the number of sub-assembly parts from around 200 for the Figo hatchback in 2010 to 800 for the new Figo and Aspire