Indian utility vehicle giant Mahindra & American automaker Ford have officially formed a joint venture (JV) in India. Mahindra will hold a 51 % stake in this JV while Ford will hold 49 %. Both companies will have equal board representation and voting rights. Valued at 1,925 crores, this joint venture will see Mahindra taking over Ford’s Indian operations at the Chennai and Sanand factories. In turn, Mahindra will offer its platforms to Ford, for 3 new SUVs including a mid-sized SUV that will use the Mahindra XUV500 platform. Ford is expected to offer the KA (Figo) platform to Mahindra for electrification, and the electric cars from this partnership will be sold under both Mahindra and Ford badges. The American automaker will retain control over the engines factory at Sanand, and will also continue to own the Global Business Services unit, Ford Credit and Ford Smart Mobility businesses.
Ford will continue to own the ‘Ford’ brand in India, and will also retain control over its dealership network. Ford badged cars will continue to be sold in India, and the automaker will also export a big chunk of production to markets abroad. There will be no change in the functioning of Ford’s existing dealership and after sales network. Mahindra will continue to have its own dealership and after sales network, independent of Ford’s.
Ford’s joint venture with Mahindra is meant to cut costs and allow Ford to stay back in India, which is poised to become the 3rd largest car market in the world in the coming years. Expect to see three new Ford SUVs using Mahindra engines and platforms. In future, this joint venture could expand to include more vehicles. Meanwhile, here’s what Anand Mahindra, the chairman of the Mahindra group, had to say about the latest JV,
Mahindra and Ford coming together is a testament to the long history of cooperation and mutual respect between the two companies. Our combined strengths – Mahindra’s expertise in value-focused engineering and its successful operating model, and Ford’s technical expertise, global reach and access to future technology – are a potent recipe for success. At its core, the partnership will be driven by the shared values of both companies, which are focused on caring for our customers, associates and our communities.
Bill Ford, the executive chairman of Ford Motor Company said this,
Ford and Mahindra have a long history of working together, and we are proud to partner with them to grow the Ford brand in India. We remain deeply committed to our employees, dealers and suppliers, and this new era of collaboration will allow us to deliver more vehicles to consumers in this important market.