M&M, Ford to explore strategic co-operation in India, emerging markets

Utility vehicle major Mahindra & Mahindra (M&M) and Ford Motor Co agreed to explore a strategic alliance for joint development of products, including electric and connected vehicles.

This comes after Tata Motors decided to end similar partnership negotiations with Volkswagen group in August.

The partnership will also look at expanding Ford’s reach in the domestic market and Mahindra’s access to global markets. The announcement comes less than three months after Tata Motors (the only other homegrown player in domestic car market) decided to end partnership talks with Volkswagen group.

The areas of potential cooperation include mobility programmes, connected vehicle projects, electrification, product development, sourcing and commercial efficiencies, distribution within India (improving Ford’s reach within India) and improving Mahindra’s reach outside of India.

Teams from both companies will collaborate and work together for a period of up to three years. Any further strategic cooperation between the two companies will be decided at the end of that period.

“Ford is committed to India and this alliance can help us deliver the best vehicles and services to customers while profitably growing in the world’s fifth largest vehicle market,” said Jim Farley, Ford executive vice president and president of Global Markets.

“Our two companies have a long history of cooperation and mutual respect. The memorandum of understanding we have signed today with Mahindra will allow us to work together to take advantage of the changes coming in the auto industry. The enormous growth potential in the utility market and the growing importance of mobility and affordable battery electric vehicles are all aligned with our strategic priorities,” he added.

Mahindra has been leading the utility vehicles segment in India for the past seven decades.

Expanding its global presence, Mahindra owns majority stake in Ssangyong Motor Company in Korea, has forayed into the shared mobility space with investments in ride sharing platforms in the USA, and is developing products like the GenZe - the world’s first electric connected scooter.

“The changes facing the automotive industry globally are triggered by the accelerated rise of new technologies, sustainability policies and new models of urban shared mobility.

Given these changes we see the need to anticipate new market trends, explore alternatives and look for ways to collaborate even as we compete and build powerful synergies that will allow rapid exploitation of the exciting new opportunities.

Today’s announcement builds on the foundation laid through our past partnership with Ford and will open opportunities for both of us,” Pawan Goenka, managing director, Mahindra and Mahindra Ltd said.

Ford was among the first global automakers to enter India in 1995. Now one of the largest exporters of cars from the country, Ford manufactures and exports vehicles and engines from its manufacturing facilities in Chennai, Tamil Nadu and Sanand, Gujarat.

India is also the second-largest Ford employee base globally, with more than 14,000 people working across the Ford India or Global Business Services operations in New Delhi, Chennai and Coimbatore.