Mahindra and Mahindra Limited and Ford Motor Company have joined hands to develop, market and distribute the Ford brand vehicles in India. Moreover, the agreement also includes the development, marketing and distribution of both Ford and Mahindra vehicles in high-growth emerging markets around the world. Mahindra owns a 51 per cent controlling stake in this joint venture, while Ford holds a 49 per cent stake.
Under the newly announced joint venture, Ford has transferred its India operations to Mahindra, this includes its personnel and assembly plants in Chennai and Sanand. However, Ford will retain its engine plant operations in Sanand as well as the Global Business Services unit, Ford Credit and the Ford Smart Mobility. As revealed to the media, the joint venture will be responsible for growing the Ford brand in India and exporting its products to Ford entities globally. Ford will continue to own the Ford brand, and its branded vehicles will be distributed through the current Ford India dealer network. While Mahindra on the other hand, will continue to own the Mahindra brand and operate its own independent dealer network in India.
The joint venture is stated to be the next step in the strategic alliance forged between Ford and Mahindra in September 2017 and is expected to be operational by mid-2020, subject to regulatory approvals. The joint venture will be operationally managed by Mahindra, and its governance will be equally composed of representatives of Mahindra and Ford.
Under the joint venture, three new utility vehicles will be introduced under the Ford brand, beginning with a new midsize sports utility vehicle that will have a common Mahindra product platform and powertrain. We believe that the first product to be shared with Ford could be the new-gen Mahindra XUV500. Apart from this, there will be a compact SUV and a new MPV.
Another area of focus for the joint venture will be electric vehicles. Ford and Mahindra will collaborate to develop vehicles to support the growth of sustainable mobility across emerging markets. As part of electric vehicle plans under the joint venture, we expect to see an Aspire-based electric vehicle.
Speaking on the occasion, Anand Mahindra, Chairman, Mahindra Group said, “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.”
Commenting on the joint venture, Bill Ford, Executive Chairman, Ford Motor Company said, “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.”
Adding to it, Jim Hackett, Ford president and CEO said, “At Ford, our purpose for 116 years has always been to drive human progress, and that won’t change. But to continue to do that, we need to evolve with new and faster ways of not only delighting our customers around the world but also solving their very different needs. Strong alliances like this play a crucial role in assuring we continue to achieve our vision while at the same time staying competitive and delivering value to our global stakeholders.”
