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Mahindra & Ford decide not to work together in India, cancel Joint Venture plan

Written by Nizam Shaikh

On 1st October 2019, Mahindra and Ford joined hands and announced that the brands will togather develop a range of vehicle for the Indian market as well as for exports to the emerging markets. The brands have now announced that both Mahindra and Ford have jointly and amicably concluded that they will not be going ahead with the previously announced partnership. 

The decision has come from the passing of the December 31, “longstop”, or expiration, date of a definitive agreement between the two companies, where Mahindra was the controlling partner with 51% stakes. According to the companies, the split between the two is the result of global economic and business conditions that have been caused by the COVID-19 pandemic which affected the companies since the joint venture was announced. This led both the companies to reassess their respective capital allocations and influenced the decisions. 

Ford has stated that their India operations will remain to continue and even Mahindra issued a press statement where the brand announced that the decision will not affect their product plan, but it remains to be seen what will happen to the products that were being jointly developed between the two. 

Ford is expected to launch the new C-SUV in 2022 based on the 2021 Mahindra XUV500 which is expected to be launched this year. But, the other SUVs which were being developed under the collaboration for the future B-SUV codenamed ‘BX745’, a new Ford Mahindra MPV which could be based on the Mahindra Marazzo and a compact SUV codenamed ‘BX744’ which could be the next-generation EcoSport. 

The purpose of the joint venture was to create synergies by platform and engine sharing and reducing operational costs. The American brand had also handed over the assembly plants in Sanand & Chennai along with the personnel to Mahindra at the time when the Joint Venture was announced. The brands are expected to share more details on the same in the near future.