Ford JV with Mahindra |
American Multinational automaker Ford Motor Company and India`s Mahindra & Mahindra said on Tuesday they would form a joint venture in India, in a move aimed at reducing risks for the U.S. automaker`s local businesses and cutting the cost of developing and producing vehicles for emerging markets. The venture, valued at $275 million, will see Ford enlist Mahindra as a partner for developing and selling vehicles in India and emerging markets using the U.S. automaker`s production facilities in the country. By shifting to a joint venture, Ford is also changing its strategy for India, where it has long run an independent operation. India, where auto sales are slumping, once promised growth for global carmakers, many of which are now frustrated after working hard to gain a foothold. The new entity, which will be operationally managed by Mahindra, will develop and sell Ford brand vehicles in India and export Ford and Mahindra brand vehicles to emerging markets. Mahindra will bring its sourcing, supply chain and Indian market knowledge to the table and will in return get access to Ford`s global reach and technology. Ford`s decision comes at a time when Indian government is trying to boost local manufacturing by cutting corporate tax rates and offering cheap loans to push car sales.
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