The Ford-Mahindra Joint Venture Comes To An Abrupt End

• Reasons attributed to fundamental changes in global economic and business conditions caused in part by the COVID-19 global pandemic over the past 15 months.

• The joint venture was announced back in October 2019.

• Plans for the XUV500-based Ford SUV, as well as the 130PS 1.2-litre T-GDi petrol engine for the Ford EcoSport remain unchanged.

2021 has started off with a massive bombshell from Ford and Mahindra as the two carmakers have announced that the joint venture they entered into back in October 2019 has been called off. The two companies claim the reason behind this abrupt halt is the fundamental changes in global economic and business conditions caused in part by the COVID-19 global pandemic over the past 15 months. This has caused the two companies to reassess their respective capital allocation priorities.

Back when the new Ford-Mahindra JV was announced in October 2019, it was stipulated that Mahindra would hold a 51 percent controlling stake while Ford India would be a 49 percent stakeholder. This split is a major blow to the variety of plans under this JV as upto seven new models were in the pipeline.

Mahindra has clarified that projects like Ford’s iteration of the upcoming second-gen Mahindra XUV500 SUV, and the introduction of Mahindra’s 130PS 1.2-litre T-GDi turbo petrol engine to the Ford EcoSport remain unaffected as these were in advanced stages and were part of an agreement which was before the now-defunct joint venture. That said, other potential projects like the Ford MPV based on the Mahindra Marazzo, a new compact SUV as well as a Mahindra-badged Aspire EV will be revived in the coming months and decisions will take in the best interest of both the companies.

As things stand, the two carmakers will continue with their operations in India independently. But this decision is quite a bummer as the joint venture had a roadmap full of enticing models we were looking forward to.