- Mahindra and Mahindra will soon be investing in Ford Motor in a big way.
- The Competition Commission has approved the formation of a Joint Venture between Mahindra and Ford.
- The 51% stake could cost Mahindra a sum of Rs 657 crores.
With the competition heating up to high levels in the automobile industry, joint ventures seem to be the best way to go forward. Mahindra and Mahindra Ltd is forging a JV with Ford Motor Co for which the Competition Commission has given its approval. As a result, Mahindra is eyeing an investment of Rs 657 crores to acquire 51% holding in Ford India Pvt Ltd, the Indian subsidiary of the American automotive giant.
With the formation of this JV, Mahindra will take over the manufacturing plants of the company at Chennai and Sanand. Though Mahindra and Mahindra will be managing the joint entity, Ford will have its representatives, as well on the governing council. The new JV will now develop, market, and distribute Ford cars in India.
Mahindra will get control of the manufacturing plants alone. The engine plant operations and the Global Services Business Unit, Ford Smart Mobility, and Ford Credit will be run by Ford. Ford will also continue to own the brand name with the sales of its vehicles happening through its existing dealership chain.
Mahindra will be handling its vehicle division independently. The JV will prove beneficial for the growth of the company as it will be handling the export division that Ford India Pvt Ltd caters to, at present.