Ford laid foundation for $ 1billion dollar factory in India.

Ford MotorMumbai: Ford Motor Co. lays the foundation for a new $1 billion dollar factory in India on Thursday, pressing ahead with extension plans despite an unsure outlook for Asia’s No. 3 economy where growth in car sales has lately declined.

Ford’s plant will have the capacity to manufacture 240,000 cars and 270,000 engines a year when it’s complete in 2014. The factory will manufacture cars for domestic consumers and for export.

Michael Boneham, Ford India’s managing director, said in a statement that “We are committed to significantly increasing our manufacturing output and aggressively expanding our business in India.”

Car sales in India have endured as the economy has slowed. High interest rates, driven by the central bank’s hostile efforts to control inflation, have also hurt demand.

The ruling Congress Party has not been capable to corral restless coalition partners and state leaders to push through amends in foreign investment, tax, labor and land laws that could unlock growth and assure investors. Ford plans to launch eight latest vehicles in India by the middle of the decade, the reports said.

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