Monday, March 4, 2013

“Our global strategy fitted beautifully"

Ford India President & MD Michael Boneham has worked tremendously hard on his India basics since appointment. In an exclusive interaction with sanchit verma, Boneham talks about Ford's new outlook towards India

B&E: What was your initial reaction when you were informed by Alan Mulally to handle the Indian operations?
MB (Michael Boneham): Firstly I have been a previous manufacturing director for the region of Asian Pacific & Africa; so I had a good understanding of India and I have come over here a number of times and spent time over here. I thought I have a good understanding of India but in reality I didn’t, because Chennai is not India and India is not Chennai. For me, I was always very excited about the opportunity because I knew that India was going to become very very strong in Ford's plans globally. Three years ago, we were still in the process of putting that strategy together and working on the strategy and trying hard to get a vehicle into the heartland of the Indian market. That was certainly a small car because 70% of vehicles in India are small cars and we have never done that in India before. We have done well in the segments we are in but those were small segments. And what we were, was being a niche player, a very interesting niche player; and that was what we didn't want to be any more. We wanted to be a major player. So obviously for me as an individual, it’s challenging. My boy is in Australia and it's the most difficult separation. So overall, the opportunity and challenge which the Indian market gave me is fantastic. I couldn’t think of a better place to be in.

B&E: During the economic breakdown when GM announced bankruptcy, Ford managed to survive. Can you share your experience of those times?
MB: Everyone suffered to an extent through the global financial crises. It was not only the car industry; it was the total industry; the global economy which faced difficulties. For Ford, we started with a better plan which Alan Mulally initiated. During the crisis, we were heavily into restructuring, looking at volume, doing balancing, getting capacity as per demand, looking at our global product range and making it from the fuel efficient perspective. We were taking our profile from being a truck manufacturer to a motor vehicle manufacturer, where we went through the segment range. We all started significantly on the journey and borrowed over $20 billion to fund our products right and that was when the credit markets were open and available to us. That was a smart move when the economy came down and it enabled us to come though the very difficult period. We were very proud of the fact that we did not use any government funding in US. If you look at the turnaround and the way we moved very quickly from what was the most devastating and the most difficult period for the global economy and the industry in 2008-09 to $2.3 billion dollar profit in Q1 this year.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

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