| 11:04 AM EST

Ford Confirms Indian JV with Mahindra


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Ford Motor Co. confirms it is forming a joint venture with Mahindra & Mahindra Ltd. to take over the American company’s carmaking operations in India.

The unnamed entity, valued at $275 million, will be owned 51% by Mahindra and 49% by Ford. Reuters, citing unnamed sources, reported on the plan in April.

The venture is expected to become operational next summer, pending regulatory approvals.

The JV will create an integrated entity to execute a series of collaborations on mobility, connectivity and electrification that began between the companies in 2017. Last year the partners announced separate deals to share powertrain and vehicle connectivity products. Earlier this year they agreed to jointly develop a midsize SUV and a telematics control unit.

Ford’s assembly plants in Chennai and Sanard, and the employees at each facility, will be absorbed by the new JV. Ford will retain it engine plant in Sanard and its Ford Credit, Ford Mobility and Global Business Services units.

The new venture will develop three Ford-branded crossover vehicles. One of them will be the midsize SUV project announced last year, which will utilize an existing Mahindra chassis and powertrain. The JV also plans to develop all-electric vehicles for emerging markets.

Each model produced by the venture will be branded either Ford or Mahindra and marketed in India through each partner’s own dealer network.

Ford predicts the new JV will help it gain traction in India after nearly 25 years of lackluster results there. CEO Jim Hackett concedes Ford erred in attempting to apply a North American business model to its Indian operations. The company currently holds a 3% stake in the Indian market.

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