Ford freezes projects with Mahindra in India

Ford freezes projects with Mahindra in India

February 19, 2021 0 By autotimesnews

Ford has suspended all of its ongoing projects with Mahindra & Mahindra as it plans to develop a new strategy for the Indian auto market.

Ford announced earlier this year that it was closing its joint venture with Mahindra & Mahindra due to, among other things, the COVID-19 pandemic. The decision came almost a year after the two companies agreed to form a joint venture in India to reduce the cost of developing and manufacturing vehicles in emerging markets. The automakers planned to build at least three SUVs, and share suppliers, engines and technology.

Ford has only 3% of the Indian market. Foreign sources say the American manufacturer is seeking to complete a new strategy in India that could foster a new relationship with Mahindra or end it altogether. It is also reported that Ford is reviewing already planned programs with Mahindra and deciding which ones to keep based on future profits.

“We are rethinking our business strategy, making choices and allocating capital in line with a plan to achieve an 8% Adjusted EBIT margin and generate consistently strong cash flow. We will have more details that we will share later, ”said Ford spokesman Kapil Sharma.

One of the most important vehicles planned is the mid-size SUV, which will be built by Mahindra and launched in 2022 with an annual sales target of 50,000 units in India. In addition, Ford is negotiating new terms to supply the EcoSport engine to Mahindra. The other two planned SUVs will also use Mahindra’s powertrains, but if the American automaker abandons the deal entirely, it will either have to find another supplier or use its own engines.