US carmaker Ford Motor and Indian car manufacturer Mahindra and Mahindra had announced a joint venture last year that Mahindra was to acquire Ford's operations in India while the American brand had to help Mahindra enter several international markets. However, by the end of 2020, the two automakers has decided to end the joint venture for several reasons.
Earlier this year, Ford Indiadecided to put all its plans with Mahindra on hold until it formulated a new strategy for India. But now, according to recent media reports, the American automaker has decided to end all partnerships with Mahindra.
In October 2019, Ford and Mahindra had said they would form a joint venture in India in a move to cut costs for developing and producing vehicles for emerging markets. The companies said at the time they expected to launch three new utility vehicles, starting with a midsize SUV, and also jointly develop electric vehicles for emerging markets.
Ford was working on three new SUVs in India by partnering with Mahindra. One of these was a compact SUV originally to be launched in India next year. Built by Mahindra, this Ford C-SUV was to be built on the platform of the new XUV500. But it seems that Ford now wants to develop this product alone in India. It is being said in the reports that the company can be built on the lines of its Ford Territory SUV sold in China.
According to the joint venture of the two companies, two of the upcoming Ford SUVs were going to use Mahindra engines. The company has also canceled this plan and the American brand is going to use its engines for these vehicles. According to reports, Mahindra was to give its XUV 300 a 1.2-litre turbo-petrol engine in EcoSport. But now, Ford EcoSport is expected to continue using its existing 1.5-litre powertrain.
Ford's decision to terminate all relations of its partnership with Mahindra is based on several reasons. According to reports, Ford's position in the Indian market is not very good due to which the CEO of the company, Jim Farley, has put more focus on strengthening its global positioning on priority. In addition, Ford has decided to end its partnership with Mahindra, given the financial circumstances leading to the Covid-19 epidemic.