Ford India is planning to form a new Joint Venture with our homegrown car maker Mahindra & Mahindra. As per Reuters report, the joint venture deal can be closed as soon as 3 months.
So what that means is that Ford will quit Independent brand. All the deliveries and maintenance will be managed jointly by Ford and Mahindra only. Ford will still continue to sell its vehicles through Mahindra.
As per the report, Ford will hold 49 percent stake in the Joint Venture, while 51 percent stake will be with Mahindra. Over the span of twenty years two, Ford has spent over $2 billion in India but the outcome has not been so good. It struggles to touch the mark of 10,000 units per month. With a market share of only 3%, Ford is not doing very well in India, despite their constant efforts.
Ford also came together with Mahindra recently for selling vehicles through Mahindra dealerships in the region where Ford dealerships network is weak. Ford has joint ventures in many markets across the world, including China and Russia.
“It’s like a partial exit (for Ford from India),” one of the sources said. Puneet Gupta, associate director at IHS Markit, said the deal would help Ford and Mahindra launch new models at a faster pace and lower development cost, which is critical to success in a price sensitive market like India, It’s a win-win situation for both,”. Ford and Mahindra both refused to talk about the deal at the moment.
Ford and Mahindra together will work on electric vehicles together, Mahindra will provide Ford the technology such as electric powertrains and battery packs. They will also share platforms across various models in India The first one can be an SUV from Ford sharing its platform with the Mahindra XUV 500.