Ford and Mahindra to end collaboration on all projects in India

[NEW DELHI] Ford Motor and Mahindra & Mahindra will not collaborate on any project they had agreed to as part of their abandoned joint venture in India, the companies said.

Ford and Mahindra had proposed a joint venture to develop at least three sport-utility vehicles (SUVs) for India and emerging markets, as well as share suppliers, powertrains and technology.

The deal, which would have ended most of Ford's independent operations in India, was called off on Dec 31.

The companies were expected to make a decision by the end of March on whether to continue with all or some of the projects under a new relationship or end all talks.

"As part of winding down our relationship, several cooperative product programmes will no longer proceed. We are currently re-scoping those product programmes," a Ford India spokesman said in a statement on Thursday.

Ford has previously said that its independent India operations will continue.

Rajesh Jejurikar, executive director at Mahindra, told Reuters late on Wednesday that "at this point there are no plans to continue on any of the projects".

Michigan-based Ford entered India 25 years ago, but it has only a 2 per cent share of a market dominated by Suzuki Motor and Hyundai Motor's extensive line-up of mainly low-cost cars.

The tie-up with Mahindra would have enabled Ford to launch new vehicles faster and at reduced costs with lower investment, company officials and analysts previously said.

The two automakers had planned several projects together, including a mid-sized SUV to be built in 2022 by Mahindra on its vehicle platform and using its powertrain.

For two other SUVs that Ford was working on for launch in 2023 and 2024, the plan had been to use Mahindra's engines. Ford will now need to find another supplier or invest in upgrading its own engines, sources have said.

Ford executives have said on several occasions that the company is exploring all options in relation to its India business.

REUTERS