Ford India today appointed its fifth managing director — Michael Boneham (pronounced Bonam) — since it started its operations in India 14 years ago. The company announced this development at a media conference in Chennai today.
Boneham will replace the current managing director, Arvind Mathew, from June 1. Mathew will be moving to Ford's headquarters in Michigan as a part of the global product development team.
Boneham is taking over Ford's Indian operations at a very critical juncture — it has planned a $500 million (Rs 2,000 crore) investment in expanding its capacity and product portfolio and establishing an engine manufacturing plant at its existing location in Maraimali Nagar near Chennai.
Fresh investment is expected to be completed by 2010. With this, the company's accumulated investment in the Indian operations will be $850 million (Rs 3,500 crore).
Since its inception in India in 1994, Ford India continues to depend on its parent company in Michigan to fund its expansion plans. Nearly 70 per cent of the fresh investment has been brought in as equity by the parent company, while some funding is through debt from the domestic market.
In contrast, recent investments by competitors such as Hyundai Motor India and Maruti Suzuki have been funded through internal accruals in their respective domestic operations.
Despite being one of the earliest global car markers to enter India, Ford has remained a marginal player with only 2 per cent (2007-08) market share in the 1.5 million passenger vehicle market.
Boneham said that while no major changes will be made in the current product portfolio for Ford India, the company will start looking at the small car market more seriously now.
Small cars account for more than 70 per cent of the Indian car market with major players such as Maruti Suzuki, Tata Motors and Hyundai Motor India. Last year, even General Motors started offering its first small car, Chevrolet Spark, which helped the company improve its market share to 4.5 per cent.
Boneham, who moved to India in August 2007 as executive director responsible for product engineering, purchasing, manufacturing and quality, has more than two decades of experience in the Ford Group, including Land Rover (now sold to Tata Motors) and Mazda.
Boneham served as the manufacturing director (Asia-Pacific and Africa) based out of the American car maker's regional headquarters in Bangkok, Thailand.