Mahindra and Ford had announced a number of new developments in their partnership that roots back two years ago and it included a new joint venture company. While recent speculations indicated that Ford would quit India due to unfavourable market scenario, the JV proves that it won’t be the case. Ford has taken aggressive steps such as shelving its sedan lineup, narrowing platforms and product offerings as well as closing its production facilities to bring back profits globally in recent times.
However, in India, it has entered a new JV with Mahindra owning 51 per cent control stakes and the Blue Oval the remaining 49 per cent. The strategic alliance is crucial for Ford to recover from its dwindling sales fortunes as it will help develop, market and distribute its vehicles into the near future.
1. Ford Not Quitting India:
Firstly, Ford is definitely not quitting India as General Motors did less than a couple of years ago. However, it will transfer its local operations to the JV including the working personnel and plants in Chennai and Sanand. The Dearborn-based brand will retain its engine facility operational in Sanand along with Ford Credit, Ford Smart Mobility and its Global Business Services unit.
Here are the known facts from the Mahindra-Ford JV you definitely need to know,
2. Ford To Continue Using Its Existing Dealer Network:
The JV will be operated by Mahindra but the governance board will have representatives from Ford as well. The joint venture will likely come into effect from mid-2020 and is subjected to regulatory approvals. It is also clearly stated that Ford will continue to run its brand under the current dealership and distribution network.
3. Ford To Support Mahindra In Emerging Markets:
It appears like the joint venture has more significance to Ford than Mahindra. But, it is not the case as both the brands are trying to achieve mutual benefits going forward. Valued at Rs. 1,925 crore (USD 275 million), the JV will help in Mahindra utilising Ford’s expansive global network to widen its footprint and exports. Ford’s International Markets Group (IMG) business unit will have an important role in Mahindra’s exposure elsewhere as it brings together as much as 100 emerging and emerged markets such as India, Australia, countries part of ASEAN, the Middle East and Africa alongside Russia together.
4. Three New Ford UVs In The Pipeline:
As early as next year, a mid-size SUV carrying the Ford badge is expected to be launched in India having several similarities with the next-generation Mahindra XUV500 bound for late 2020. Besides, two more UVs have been confirmed to be on the horizon and it could include an MPV as platform and powertrain sharing will be part of the equation for the betterment of the future and to slash down costs.
5. Co-Development Of EVs:
Mahindra and Ford will co-develop zero-emission vehicles in the coming years for emerging markets as the Aspire EV based on e-Verito could be on the cards. In the realms of product development, sourcing and access to technologies the JV is expected to make a strong impact not just for Ford but Mahindra as well.