Af­ter failed solo ride, Ford inks JV with M&M

The Times of India (New Delhi edition) - - Times Global - TIMES NEWS NET­WORK

Mum­bai: Ford Mo­tor has de­cided to park its strug­gling In­dia busi­ness into a joint ven­ture with Mahin­dra & Mahin­dra af­ter the Amer­i­can com­pany failed to make sig­nif­i­cant in­roads into the world’s fourth largest au­to­mo­bile mar­ket for the last 24 years.

Ford, among the first global au­tomak­ers to en­ter In­dia in 1995, four years af­ter the eco­nomic lib­er­al­i­sa­tion, will cede con­trol in its lo­cal op­er­a­tions as it believes “part­ner­ships will be­come the norm in the in­dus­try”.

Ford, which will trans­fer most of its In­dia as­sets to the JV, will hold 49% in the new com­pany val­ued at Rs 1,925 crore, while Mahin­dra will own the re­main­ing 51%. The JV, which will house Ford’s two assem­bly plants in Chen­nai and Sanand, and em­ploy­ees, will be man­aged by Mahin­dra while the gov­er­nance board will have equal rep­re­sen­ta­tion by both the par­ties.

The JV will ex­clude Ford’s en­gine plant in Sanand, global busi­ness ser­vices unit, auto fi­nance op­er­a­tions and mo­bil­ity ser­vices in­vest­ments. “The world we are in is com­plex, and re­quires part­ner­ships as no one can do ev­ery­thing,” said the Amer­i­can com­pany’s chair­man Bill Ford through a video con­fer­ence.

While the Michi­gan-based au­tomaker will con­tinue to own the Ford brand, the JV will de­velop, mar­ket and dis­trib­ute the Ford-badged cars in In­dia as well as in emerg­ing mar­kets around the world. The JV plans to launch three ve­hi­cles, be­gin­ning with a mid-sized SUV.

Ford and Mahin­dra have a long his­tory of work­ing to­gether — the two had joined hands to launch Ford Es­cort in In­dia. How­ever, the duo later parted ways to pur­sue their in­di­vid­ual am­bi­tions. “We are two old friends, who have de­cided to move into a new house and pool in re­sources to­gether,” said the In­dian com­pany’s chair­man Anand Mahin­dra.

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