Ford to ride on M&M dealers to expand in India
NEWDELHI: Mahindra and Mahindra (M&M) Ltd has started selling passenger vehicles of Ford Motor Co. in India as the automakers expand their partnership beyond the joint development of vehicles.
For the first time, M&M dealers are opening showrooms for Ford vehicles, especially in regions where the Detroit-based automaker does not operate one or the existing dealer has not been able to garner sufficient sales, said two people aware of the matter, requesting anonymity.
M&M dealers are also opening separate service centres for Ford vehicles at their dealerships, they said. “Ford doesn’t have a robust chain of channel partners, so by letting Mahindra dealers sell Ford’s vehicles, the company is trying to reach most of the towns and districts of the country,” said the first of the two people cited above. “Mahindra dealers are also making quick money from setting up small showrooms and selling Ford’s most popular vehicle, Ecosport.” The latest arrangement will allow Ford to tap into M&M’S nationwide reach, especially in small towns and rural areas. Mahindra dealers would, meanwhile, earn an additional source of revenue by selling and servicing Ford vehicles, the people cited earlier said.
A spokesman for Ford India Pvt. Ltd said the two companies “have initiated a pilot, where select Mahindra dealers in Tier 4+ towns were given an opportunity to sell and/or service Ford cars”. “The pilot has been rolled out to 15 towns and the results are encouraging, giving incremental sales and service reach for Ford.”
The two automakers are continuing to explore “the benefit of leveraging the Mahindra network in areas where Ford dealership is not present/planned”, the spokesman said.
Ford and M&M signed an initial pact in March to develop a new sports utility vehicle on a Mahindra platform and a small electric vehicle. Subsequently in October, M&M and Ford announced the signing of two definitive pacts to share Bharat Stage Vi-compliant engines, besides jointly developing connected vehicle solutions for the Indian market.
The expanded alliance would see existing M&M dealers sell some of the future products of Ford—that will be jointly developed by the two companies— from their new Ford showrooms. Ford India’s managing director, Anurag Mehrotra, has already met a group of M&M dealers a few months ago to discuss the opportunities ahead and the expectations of the company. The consolidation of their India business by Ford and M&M could be a crucial step for their growth in the Indian market, as this would enable them to increase their reach and give more competition to larger rivals such as Maruti Suzuki and Hyundai, said Puneet Gupta, associate director at IHS Markit.