American auto giant Ford is investing a lot of money in India and is also coming up with a new project which is a mid-size sedan competing with the Honda City.

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Ford India has a development centre in Chennai and another plant in Sanand, Gujarat. The company recently spent a billion dollars for its Sanand plant. To contribute their part for the Make In India campaign, Ford India will now be investing another Rs. 4000-5000 crore in its R&D centre at Tamil Nadu. This new investment will exceed Ford India’s total cumulative investment here by 50 percent. The auto giant will sign an agreement with the government of Tamil Nadu in the next couple of months and then a formal announcement may be expected before the end of this year.

Ford India is also developing an all-new vehicle which has been codenamed B500. The B500 project is a mid-size sedan that is likely to compete head-on with the Honda City. The new sedan will be readied and launched in our market only by 2018 though. So, till then Ford will continue to sell the Fiesta here which isn’t really setting the sales charts on fire. The B500 project will also be the basis for a new MPV that will be launched after the sedan debuts. Ford doesn’t have any MPV in its India portfolio and hence launching this vehicle might seem like a good decision.

The company has realised and taken note of the engineering capabilities that India has and wants to make use of these skills on a large scale. The automaker will implement Indian engineers’ skills not only for Indian products but also for global products. The company also aims to increase localisation content in its vehicles that will further drive costs down. Another reason for investing in India is the cheap cost of production and labour that is less than half of what it is in developed countries.

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