Ford EV manufacturing in India, hasn’t been confirmed yet, but the company is gearing up to restart operations at the Ford Chennai Assembly plant after mothballing the plant several years ago. Tellingly, India has been working on efforts to attract manufacturers into building EVs in the country. And according to a new report, a new incentive may greatly benefit the Blue Oval.
According to Reuters, India is finalizing plans to offer incentives to automakers who utilize existing plants for EVs as a course correction for initially only extending incentives to all-new facilities. The intent behind establishing incentives for entirely new plants was to attract Tesla, but the company decided against building in the country. The new plan would open up incentives to include factories that build gasoline and hybrid vehicles, although the government wants EVs to be built on a separate assembly line and to source content locally. The benefits for Ford EV production could be immense, if the policy ends up being ratified. Essentially, if Ford invested $500 million into Chennai and utilized local suppliers, India would cut import taxes on up to 8,000 EVs per years. Additionally, the company would not be penalized for building gasoline and fully electric cars at the same plant, which aligns well with previous reports that suggest the company could build SUVs or battery electric vehicles in the country when it turns the lights back on in the future.
The former Ford EcoSport plant will likely be used as an export hub, similar to how Ford has positioned its manufacturing strategy in China. That said, it’s been a chaotic year when it comes to Ford EV manufacturing predictions, as the company spent 2024 throwing out the bold plans it established over the last two years. Ford cancelled its three row EVs that were due to come out of Oakville in favor of the Super Duty. Additionally, it delayed the next-generation Ford F-150 electric pickup and cut production at the Ford Cologne Electric Vehicle Center, which had only just recently started producing the Ford Explorer and Capri EVs.
Comment
Ford doesn’t need yet more EV capacity, but that’s the price of entry for selling in India. Hopefully this can be a good laboratory for low-cost EV product and process design.