Ford Freezes Projects With Mahindra In India As It Reviews Local Strategy
Ford has paused all of its ongoing projects with Mahindra & Mahindra as it looks to develop a new strategy in India.
In early January, Ford announced that it was calling off its joint venture with Mahindra & Mahindra due, in part, to challenges caused by the COVID-19 pandemic. This decision came roughly 14 months after the two companies agreed to form a joint venture in India to cut costs for developing and producing vehicles in emerging markets. The automakers planned to develop at least three utility vehicles while also sharing suppliers, powertrains and technology.
Now, sources who spoke with Reuters claim that the Blue Oval is looking to finalize a new strategy in India which could see it work out a new relationship with Mahindra or even end the relationship entirely. Ford has just a 3 per cent market share in India.
Read More: Ford And Mahindra Call Off Plans For Joint Venture
“We are reviewing our businesses strategy, making choices and allocating capital consistent with the plan to achieve an 8 percent company adjusted EBIT margin and generate consistently strong cash flow,” Ford spokesman Kapil Sharma said in a statement. “We will have more details to share at a later date.”
One source claims that Ford is weighing up its planned programs with Mahindra and will decide which ones to keep based on the profits they will generate. One of the most important vehicles that was planned was a mid-sized utility vehicle that would be built by Mahindra and launched as early as 2022 with the goal of selling 50,000 units annually in India.
Ford is also said to be negotiating new terms for an engine Mahindra was expected to supply to the EcoSport. Two other utility vehicles being planned were also set to use Mahindra powertrains, but if the American carmaker backs away from the deal entirely, it will need to either find another supplier or use its own engines.
