NEW DELHI (Reuters) – Ford Motor Co is nearing a deal with Mahindra & Mahindra to form a new joint-venture company in India, a move that will likely see the U.S. automaker cease independent operations in the country, two sources with direct knowledge of the talks told Reuters.
The deal would make Ford the latest automaker to pare back its interests in India. At the end of 2017, General Motors Co downsized its Indian operations and stopped selling cars locally, dealing a blow to Prime Minister Narendra Modi’s strategy to encourage domestic manufacturing.
Over two decades, Dearborn, Michigan-based Ford invested more than $2 billion in India but has consistently struggled – it currently has a market share of just 3 percent in India, one of the world’s fastest-growing car markets.
Under the terms of the deal being negotiated, Ford will form a new unit in India in which it will hold a 49 percent stake, while Mahindra will own 51 percent, the two sources said.
The U.S. carmaker’s Indian unit will transfer most of its current automotive business to the new entity, including its assets and employees, according to one of the sources.Read More
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