Mahindra Ford exploring a global partnership for mutual benefit?
Mahindra North American Technical Centre could play a significant role if the deal fruictifies.
Mahindra and Ford are reportedly exploring possibilities of reestablishing their partnership (Ford entered India with Mahindra’s help). According to Times of India’s sources, the talks are in preliminary stages but if it attains fruition, the automakers would be looking at excess capacity sharing, joint product and platform development.
Ford India currently has excess production capacity, thanks to its Sanand plant and if the deal goes through, Mahindra could make use of it thereby avoiding a significant investment in a new production facility. While TOI’s sources maintain that the contours of the discussion between the two automakers are still hazy, it’s being said that Mahindra North American Technical Centre (MNATC) could play a vital role in the partnership.
As far as Ford in concerned, a partnership with Mahindra would help it gain a better understanding of the Indian market in addition to being introduced to frugal engineering and practices. For Mahindra, the tie-up could be viewed as a launchpad into the global market.
The Indian automaker is looking to set up a second home in a strategic market to facilitate its global expansion with an eye on the US market. Mexico or Brazil, with their proximity to the US and low-cost labor, emerge as potential locations for such a base. An alliance with Ford could make things simpler and easier in this regard.
If Mahindra-Ford partnership sees the light of day, it would become the second major collaboration involving Indian automaker and a global giant. Tata Motors recently signed a MoU with Volkswagen Group to explore synergies.