The break in partnership may have repercussions across the segment
The break in partnership may have repercussions across the segmentFord Motor Company/Mahindra and Mahindra

Ford and Mahindra call off joint venture

This step was taken after consideration of business uncertainties due to Covid-19

The much-feted joint venture between Ford Motor Company and Mahindra and Mahindra has been discontinued, in the aftermath of the protracted Covid-19 shutdowns, which caused repeated delay of plans past the ‘long-stop’ or expiration date of the initial agreements signed between the brands. As per the initial deal signed in 2018, Ford and Mahindra had announced a 51:49 equity partnership, with the development of a shared new SUV platform (leading to products from both brands) and as well as electric vehicles planned for a later date. A further deal, which materialised in October 2019 also hinted towards a technology-sharing partnership with regards to the development of both new BS6-compliant engines, as well as the joint development of connected vehicle solutions for the Indian market.

Besides, the joint venture would also acquire the automotive business of Ford India Pvt Ltd (FIPL), Ford Motor Company’s Indian subsidiary, along with the vehicle manufacturing plants at Chennai and Sanand (though not the separate powertrain facility at the same location).

With the deal being called off so close to sneak peeks of new vehicles, it is unsure whether this vehicle (or vehicle lineup thereof) will go into production under the Ford badge, or into production at all. That said, there will be no changes in the brand’s existing lineup, with both brands continuing as independently operating entities, with Mahindra re-evaluating its strategy to tide over the slump in sales (and hence profitability), while Ford aiming to ramp up its approach in the Chinese and North American markets, where it has traditionally had a strong foothold.

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