New Delhi:Following protracted negotiations, Ford India and Mahindra and Mahindra are expected to soon enter a joint venture (JV) agreement for manufacturing the US-based car maker's products in India, sources said on Wednesday.
The potential deal will place the majority stake of the JV in the hands of Mahindra at 51 percent, while the remaining will be held by Ford India.
The expected deal will effectively end the American automobile major's direct operations in India. It is expected to reduce product development costs and gain economies of scale for both companies.
"Forging partnership for the future, we remain engaged with Mahindra to develop avenues of strategic cooperation that help us achieve commercial, manufacturing and business efficiencies. We look forward to sharing more information at the appropriate time, and can't comment on the ongoing speculation," said a Ford India spokesperson.
"Ford remains committed to growing its customer base in India and will continue to make in India, for India and the world. We have a strong brand, customer and dealer network in India. Using this as a foundation, we are working to expand our presence and product portfolio. We are confident that our success in India will enable us to unlock value in other emerging markets as well," the spokesman added.
Interestingly, the move is in-line with the company's global practice of streamlining operations and propping up profitability.
In April, the two companies entered an agreement to co-develop a midsize sports utility vehicle (SUV) which will be built on a Mahindra product platform and powertrain.