Mahindra and Ford have today announced a new joint venture – expected to be operational by mid-2020 – which will see both carmakers co-develop, market and sell vehicles in India and in emerging markets across the globe. Ford chairman Bill Ford addressed the media gathering in Mumbai via a video call, and said Ford will continue to build vehicles in India, for India.
According to both companies, this new JV - valued at Rs 1,925 crore – will give Mahindra and Ford a combined market share of 14 percent in India. Cumulatively, the two companies will have an annual production capacity of 1.2 million vehicles in India.
Mahindra will own a 51 percent controlling stake in this new joint venture, with Ford owning a 49 percent stake. The JV will be operationally led by Mahindra, while its governance will be equally composed of representatives from Mahindra and Ford. Ford will transfer its India operations - including its personnel and assembly plants in Chennai and Sanand - to the new company formed under this JV. That said, it will retain its engine plant operations in Sanand as well as the Global Business Services unit, Ford Credit and Ford Smart Mobility.
Terming the decision to enter into a JV with Ford as an attempt to leverage ‘best of the best’ from the two companies, Pawan Goenka, MD, Mahindra & Mahindra, confirmed there won’t be a joint brand, but both companies will continue to have their own identity in the market. Both Ford and Mahindra will continue to retail their vehicles via their respective dealer networks, but will leverage each others’ capabilities in a number of areas, including co-development of new models, which will be headed by Ford India MD Anurag Mehrotra.
Emerging from this JV will be three new utility vehicles from Ford, beginning with the C-SUV we’d reported about in 2018. The new C-SUV will be built by Mahindra, and will be a derivative of the W601 – essentially the next-generation XUV500. The W601’s platform will be developed jointly by Mahindra, SsangYong and Ford and the vehicle will be positioned above the Hyundai Creta. This Ford C-SUV will be powered by Mahindra’s next-gen, BS6-compliant 2.0-litre diesel engine. And while it will share most of its core components with the Mahindra W601, Ford’s version will have an all-new exterior, a new interior and even a slightly different (and improved) chassis. “It will drive like a Ford,” according to insiders.
The remaining two UVs are yet to be signed off, but both will be built by Ford, with one of them expected to be a brand-new compact SUV. Known internally as the B-SUV, the joint venture will either use the SsangYong Tivoli (Mahindra’s S201) or Ford’s own Vitara Brezza rival (codename: B763), that is currently being developed. The Ford and Mahindra/SsangYong SUVs will however wear different 'top hats' and will look quite different.
Electric vehicles are also on the agenda for this new joint venture, with Mahindra having previously confirmed it is currently working on a Mahindra-badged electric version of the Ford Aspire, which is slated for a 2021 launch. There will also be collaboration and sharing of powertrains starting with the Ford EcoSport that will feature Mahindra’s 1.2-litre turbo-petrol engine in place of the 1.0-litre EcoBoost in 2020; the latter unit will be phased out prior to the roll-out of BS6 norms.
In addition to co-development of new models, the JV will use the Ford brand distribution network in emerging markets for export of Mahindra cars and SUVs, in addition to Ford vehicles. Mahindra says this JV will help bring together operations of both companies in over 100 high-potential emerging markets including Australia, Africa, Russia and the ASEAN and Middle East regions.
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