Mahindra-Ford JV has been canceled on the last day of 2020, on December 31, 2020
The Mahindra-Ford joint venture, which was signed on October 1, 2019 in Mumbai, was canceled on December 31, 2020. The joint venture that gave Mahindra a 51% stake and a 49% stake to Ford, would have awarded control of Ford’s operations in India to Mahindra.
Mahindra-Ford JV
Under this joint venture, there were planned investments of around Rs 2000 crore, joint development of new cars, SUV; exchange of technologies, etc. The joint venture would have given Mahindra the rights not only to make Ford cars in India, but also to sell them in India and export them.
As evidence, some Mahindra dealers had also started selling Ford cars, in places where Ford dealers were not present. According to the joint venture signed in 2019, “Ford will transfer its operations in India to the joint venture, including its personnel and assembly plants in Chennai and Sanand. Ford will retain operations of the Ford engine plant in Sanand, as well as the global business services unit, Ford Credit and Ford Smart Mobility. “
The breaking
At the sign of the signing of the joint venture in 2019, there was a deadline that was set for December 31, 2020. If either of the two did not want to move forward, December 31, 2020 was the last day to do so. . It was this day that the deal would have been closed or broken.
the reason behind canceling the JV – “fundamental changes in world economic and commercial conditions, caused, in part, by the global pandemic of the last 15 months,” says a statement from Ford. Ford will continue its independent operations in India, while Mahindra has stated that the break-up of this joint venture will have no impact on its product plans. The announcement follows the closure of Pininfarina Engineering in Italy and the bankruptcy of SsangYong in South Korea.
The joint venture’s breakup comes a few months after Jim Farley took over as Ford’s chief executive. When the joint venture was signed in October 2019, Jim Hackett was the CEO, while Farley was the president of Ford New Businesses. Farley replaced Hackett as CEO of Ford in October 2020. The agreement was signed as part of a global restructuring plan by Ford, to reduce operating costs and increase the scale of production.
Ford-Mahindra JV car
Ford-Mahindra JV would have resulted in multiple new cars, including the next-generation EcoSport, an all-new Ford SUV in the C segment codenamed CX757. The next-generation EcoSport would have been powered by a 1.2-liter Mahindra gasoline engine, while the CX757 would have shared platform, parts and engine options with the upcoming 2021 next-generation Mahindra XUV500.
In fact, the CX757 was expected to launch late next year, after a leaked image went viral on social media. When asked what happens to the cars that were planned for launch under this joint venture, Ford said that, “at this point, there is nothing to talk about other than that the joint venture is not going to happen.”
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