Twitter LinkedIn
    Friday, January 27
    Login
    0 Shopping Cart
    Twitter LinkedIn
    Private Equity InsiderPrivate Equity Insider
    • About Us
    • Digital Events
    • Our Network
      • Reach
      • Sponsors
      • Members
    Private Equity InsiderPrivate Equity Insider
    Home»Deals»Ford, Mahindra call off auto joint venture
    Deals

    Ford, Mahindra call off auto joint venture

    January 1, 20212 Mins Read
    LinkedIn Facebook Twitter Email WhatsApp
    Share
    LinkedIn Facebook Twitter Email WhatsApp

    (Reuters) -Ford Motor Co said on Thursday it was calling off its automotive joint venture with India’s Mahindra and Mahindra Ltd due to the challenges caused by the COVID-19 pandemic.

    The companies said in separate statements that the decision was driven by changes in the global economy over the last 15 months, causing both to reassess their capital allocation priorities.

    “The global economy and business environment are not the same as October last year,” Ford spokesman T.R. Reid said.

    The deadline to finalize a joint venture between the companies was Dec. 31, and both made the decision to end the agreement rather than close a deal or extend the timetable to do so, Reid said.

    In October 2019, Ford and Mahindra said they would form a joint venture in India in a move to cut costs for developing and producing vehicles for emerging markets. The companies said at the time they expected to launch three new utility vehicles, starting with a midsize SUV, and also jointly develop electric vehicles for emerging markets.

    Asked if those vehicles were now canceled, Reid said, “At this point, there’s nothing to talk about other than the joint venture isn’t going to happen.” Ford said its independent operations in India will continue.

    Pressure to pursue mergers or alliances in the auto industry has grown as the costs of developing electric and self-driving vehicles drives companies to preserve funds for those efforts. France’s PSA and Fiat Chrysler Automobiles NV expect to close their $38 billion merger in the first quarter of 2021.

    Ford executives have repeatedly touted a company strategy that includes partnerships, including with Mahindra, as a way to increase efficiencies and reduce costs on its path to achieve 8% global operating profit margins. Reid said that strategy would continue, when asked whether Ford would look to partner with another automaker in southeast Asia.

    Mahindra said in its statement that the decision will not have any impact on its product plan, and that it is accelerating efforts to develop electric SUVs.

     

    Source: Reuters

    Image Source: Billboard

    Related

    Can't stop reading? This and all news articles are property of their creators, many are not owned or provided by Private Equity Insider. As an event organizer and community platform, we curate content from reliable sources for your suggested reading, and advise you to read the full articles from the referenced authors and sources.

    Ford M&A Mahindra Merger
    Share. LinkedIn Facebook Twitter Email WhatsApp

    Related Posts

    University of California invests $4 bn in redemption-stricken REIT

    January 3, 2023

    EQT Infrastructure acquires Madison Energy Investments

    December 22, 2022

    Euroclear moves into $9.8 trillion private asset market with Goji buy

    December 21, 2022

    Warburg Pincus acquires K2 Insurance Services from Lee Equity Partners

    December 6, 2022

    Comments are closed.

    Other Articles

    Ontario Teachers fund to buy Carlyle’s majority stake in Logoplaste

    February 26, 2021

    Bowmark Capital promotes four

    April 25, 2021

    UK private equity deal activity bounces back in second half of 2020

    February 2, 2021

    Brookfield, Sequoia Capital China partner on ‘new economy’ infrastructure

    January 21, 2022

    Private Equity Insider LLC
    1212 Avenue of the Americas
    New York City 10036
    USA

    [email protected]

    Twitter LinkedIn
    © 2023 Private Equity Insider LLC. All rights reserved.
    • About
    • Terms of Use
    • Cookie Policy
    • Privacy Policy
    • Contact Us

    Type above and press Enter to search. Press Esc to cancel.

    View Cart Checkout Continue Shopping

    Sign In or Register

    Welcome Back!

    Login to your account below.


    Lost password?