Yahoo Autos Ford taps Mahindra for Indian expansion
India is often touted as the next China but apart from a similar population, currently at well over a billion people, there isn’t much else to compare.
China has invested heavily in infrastructure and manufacturing over the past few decades, and this in turn has attracted plenty of foreign investment and helped build up a sizable middle class keen on catching up with western counterparts. Automakers, especially those in the luxury segment, have been racking up sales record after sales record for years.
The same can’t be said for India which is why most automakers apart from those selling inexpensive vehicles have struggled, despite it being the fifth largest market for new cars in the world. It was only in May that General Motors announced it was ending all sales in India.
Ford isn’t giving up just yet but realizes it needs help to fully understand the market. That’s why it’s teaming up with major Indian automaker Mahindra to explore ways the two can drive profitable growth in India and other emerging markets.
Teams from both firms will collaborate and work together over the next three years, Ford and Mahindra confirmed on Monday. Ford will bring its expertise on global markets and in return Mahindra will supply knowledge of the Indian market. The two say mobility services, electrification and product development are key areas of potential cooperation. If successful, the two will look at further cooperation after the initial 3-year period.
The Volkswagen Group has also struggled in India. It originally courted Suzuki which has seen some successes in India, though the relationship went sour and ended in 2015. In March, the VW Group teamed up with India’s Tata to help make inroads into the Indian market for the Skoda brand.
Ford was one of the first non-Indian automakers to start selling cars in India when it entered the market in 1995. Today, Ford is one of the largest exporters of cars and powertrains from the country. Ford will even start selling an Indian-built vehicle in the United States next year, the Ecosport subcompact SUV.
