Ford Motor Co.’s (F) Indian unit sold 14,092 vehicles in Aug 2014, up 27% from 11,065 units in Aug 2013. The figures include both domestic wholesale and export sales.
The increase was driven by exports, which spiked to 7,291 vehicles in the month from 3,057 vehicles in Aug 2013. However, domestic wholesales fell to 6,801 units in Aug 2014 from 8,008 vehicles in the same month in 2013.
Nevertheless, Ford India expects domestic sales to ramp up as the festive season nears. As a result, the company is planning to add a third shift to its Chennai plant. Further, it has reduced the waiting period for the EcoSport SUVs, which are popular in the country. Currently, there are over 60,000 EcoSport cars in India.
The Chennai-made EcoSport is also popular in South Africa, Taiwan, Australia and several European countries, which helps boost Ford’s exports from India. In fact, last month, the combined domestic wholesale and export sales of EcoSport surpassed 100,000 units in India.
Ford is pursuing a major expansion plan in China and India. The company expects the Asia-Pacific (mainly China and India) to account for 70% of its global growth in this decade and generate 40% of its vehicle sales in the next 4 to 5 years.
Ford expects compact car sales in India to reach about 2 million vehicles in 2018, almost double the 2013 level. In order to support the increasing demand, Ford aims to increase the dealership count to 500 in India by 2015. The company also plans to boost engine exports to Europe from its Indian units and intends to manufacture 450,000 cars and 600,000 engines in India by 2015.
At present, Ford carries a Zacks Rank #3 (Hold). Meanwhile, better-ranked automobile stocks include Tesla Motors, Inc. (TSLA), Fox Factory Holding Corp. (FOXF) and Gentherm Inc. (THRM). Tesla currently sports a Zacks Rank #1 (Strong Buy), while Fox Factory and Gentherm have a Zacks Rank #2 (Buy).
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