Mahindra and Mahindra Ltd and Ford Motor Company have called off prospects of a joint venture, blaming challenges caused by Covid-19-related factors. Changes over the last 15 months clouded prospects of the two automakers joining forces in a bid to cut costs for developing and producing vehicles for emerging markets.
Mahindra on Friday issued a statement on the end of discussions and the calling-off of the possible JV. Here's the full statement:
Mahindra & Mahindra, a part of the USD 19.4 billion Mahindra Group and Ford Motor Company have mutually, amicably determined they will not complete a previously announced automotive joint venture between their companies. The action followed passing of the December 31, “longstop", or expiration, date of a definitive agreement the organizations entered into in October 2019.
According to the companies, the outcome was driven by fundamental changes in global economic and business conditions – caused, in part, by the global pandemic – since the agreement was first announced. Those changes influenced separate decisions by Ford and Mahindra to reassess their respective capital allocation priorities.
Mahindra said that this decision will not have any impact on its product plan. It is well positioned in its core true SUV DNA and product platforms with a strong focus on financial performance. In addition, Mahindra is accelerating its efforts to establish leadership in electric SUVs.