When Ford signed their memorandum of understanding (MoU) with Mahindra last year, their goal was to create a line of new SUVs as well as a small EVs to further bolster their respective lineups. Considering the span of their partnership in the region, it appears Ford Motor Co. and Mahindra will be forming a new joint-venture company that will likely result in Ford’s transitioning of assets, staff, and operations towards the new company. Instead of remaining a sole operation in India, sources indicate that Ford will form a new unit in India, in which it will hold a 49 percent stake, while Mahindra will own 51 percent.

This means the American manufacturer’s Indian arm will transfer most of its automotive business to this new entity. “It’s like a partial exit (for Ford from India),” the source said. This move by Ford could possibly come following their 3 percent market share in India’s rapidly growing automotive industry – statistics that would prove dismal considering a sizable $2 billion investment in the region.

The deal itself is expected to close within 90 days, though stipulations nor the value of the transaction itself has yet to be made clear. Sources spoke on condition of anonymity considering the delicate matter of the deal.

The partnership between Ford and Mahindra in India has been in place as early as September 2017, but will their next speculated move give the Blue Oval a much-needed foothold in the region?

Source: Reuters