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Old 01-04-2021, 03:14 PM   #1
AVANTI R5
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Default Ford Talks With India’s Mahindra Break Off

Ford Talks With India’s Mahindra Break Off
Paul A. Eisenstein


Ford and Mahindra officials, including now-CEO Jim Farley, left, celebrate the signing of their alliance in 2018.

Ford Motor Co. and India’s Mahindra & Mahindra Ltd. have ended talks intended to establish a joint venture to develop low-cost vehicles for emerging markets.

The two companies failed to come up with a workable plan and missed a Dec. 31 “longstop,” or expiration date, for the agreement they had announced 14 months earlier.

“The outcome was driven by fundamental changes in global economic and business conditions — caused, in part, by the global pandemic,” the companies said in a joint statement, adding, “Those changes influenced separate decisions by Ford and Mahindra to reassess their respective capital allocation priorities.”

(Ford expands alliance with Mahindra Group.)

Neither automaker initially offered financial details on the proposed joint venture, which was unveiled in October 2019. However, Anish Shah, Mahindra’s incoming managing director, told reporters following the breakdown of negotiations that the Indian automaker was prepared to invest 30 billion rupees, or $410.7 million. Half of that would have been in the form of equity.



Ford builds its entry-level SUV, the EcoSport, in India, then exports them to the U.S.

The collapse of negotiations leaves both companies struggling to figure out what to do next. Ford, in particular, is facing some major challenges in its effort to penetrate third-world markets, the potentially massive automotive market in India, the world’s second-most populous nation.

“The company is actively evaluating its businesses around the world, including in India,” Ford said a statement issued after missing the longstop deadline.

As part of the plan the companies envisioned, Ford would have folded its Indian operations – including two assembly plants – into a joint venture controlled by Mahindra, that market’s second-largest automaker by passenger car sales. Mahindra currently holds a 7.3% market share, behind Indian leader Maruti Suzuki, but ahead of Tata.

If all had gone as planned, the JV would have yielded new models for Ford to sell through its Indian dealer network. Ford and Mahindra also had planned to develop a low-cost electric vehicle for emerging markets.

(Ford and Mahindra teaming up on new SUVs and an EV.)

Ford has faced some of the same challenges that rival General Motors struggled with. GM stopped selling vehicles in India several years ago, at the time announcing it would retain its production network there, but only to supply other markets.



In 2016, Ford invested $195 million into its global technology and business center in Chennai, India.

Ford uses its Indian manufacturing base to provide American dealers with its entry-level EcoSport SUV.

For its part, Mahindra said in a statement that the collapse of the talks with Ford won’t have a material impact. “Mahindra is accelerating its efforts to establish leadership in electric SUVs,” it said.

Shah, who will become managing director in April, expanded upon that in comments to Reuters. “We clearly hold the ambition to be a global brand and there again the electric journey is an important one,” he said.

Mahindra already has a foot in the door, though at the upper extremes of electrification. Its Italian-based subsidiary, Pininfarina, offers the Battista, a $2.5-million, battery-powered hypercar.

(FCA wins latest round in Jeep fight with Mahindra.)

While Mahindra is a player in India and other emerging markets, the company has ambitions to become more universal. It was forced to scrub plans to enter the U.S. pickup and SUV markets a decade ago but it now sells a small off-road vehicle produced at a plant near Detroit and is said to be looking at other opportunities in the States.
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Old 01-13-2021, 10:46 AM   #2
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Default Did Mahindra Really Lay Off More Than Half Of Its Employees In North America?

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Quote:
Did Mahindra Really Lay Off More Than Half Of Its Employees In North America?

According to two sources familiar with the matter, Indian carmaker Mahindra & Mahindra has had to cut more than half of its North American workforce since mid-2020, because of the COVID-19 pandemic, as well as its ongoing legal battle with FCA.

The company’s North American unit had over 500 employees in early 2020, with “hundreds of workers” having been laid off since to the tune of two-thirds of the total staffing, as per Reuters.

People were reportedly let go from positions such as engineering, manufacturing and even sales. Mahindra Automotive North America (MANA) admits that it has furloughed some staff and laid off others because of the pandemic, but no official figures have been provided.

“This forced us to halt production and furlough our manufacturing team and some additional people across several functions, including the Roxor sales team,” said the carmaker, while adding that it now expects to recall a large group of employees after a favorable ruling in the lawsuit against FCA.

Currently valued at just over $12.6 billion, Mahindra is still looking to sell its stake in South Korean brand Ssangyong Motor. It has also called off a joint venture deal with Ford, while pulling the plug on its U.S. electric scooter business GenZe.

Mahindra’s goal moving forward is to focus resources on developing a core portfolio of SUVs and electric vehicles.

“We are going to look ahead at how we can accelerate our investment in electric and really start moving to the new age. We clearly hold the ambition to be a global brand and there again the electric journey is an important one,” said deputy managing exec Anish Shah.
Exclusive: Indian automaker Mahindra cuts over half of North America workforce - sources
By Sudarshan Varadhan, Aditi Shah, Ben Klayman
3 MIN READ

CHENNAI/NEW DELHI/DETROIT (Reuters) - Indian automaker Mahindra & Mahindra Ltd has cut more than half of the workforce at its North American unit, two sources familiar with the matter told Reuters, due to the COVID-19 pandemic and an ongoing legal tussle.



FILE PHOTO: ROXOR off-road vehicles are seen in the Mahindra Automotive North America assembly plant in Auburn Hills, Michigan, U.S., January 30, 2019. REUTERS/Rebecca Cook
The sources did not give a figure for the number of jobs lost at the business, which had over 500 employees in early 2020, according to its website.

However, one of the sources said “hundreds of workers” had been laid off since mid-2020 as part of a restructuring, and that the cuts were as high as two-thirds of Mahindra Automotive North America’s (MANA) total staffing.

Positions include engineers and manufacturing jobs at its plant in Detroit that produces the off-road vehicle Roxor, as well as sales executives.

The cuts come as Mahindra reviews its businesses in a drive to conserve capital and retain only those that make money or have the potential to be profitable.

MANA said in a statement it had furloughed some staff and laid off others due to the pandemic and an International Trade Commission lawsuit which led to an August “cease and desist” order for the Roxor business. It did not provide figures.

Mahindra and Fiat Chrysler Automobiles (FCA) are in a protracted legal battle over an intellectual property infringement case which has prevented the Indian automaker from selling its Roxor vehicle in the United States.

“This forced us to halt production and furlough our manufacturing team and some additional people across several functions, including the Roxor sales team,” the company said.

However, last month, the company won a favourable ruling in its lawsuit against FCA, paving the way for it to begin selling the Roxor again.

It now expects to recall a large group of employees, it said in the statement.

As part of its review which began last year, Mahindra has pulled the plug on its U.S. electric scooter business GenZe; it is in talks to sell its stake in South Korean automaker Ssangyong Motor; and it has called off a joint venture with Ford Motor Co.

Mahindra’s shares have surged over 60% since it announced the review in June last year, valuing the company at over $12.6 billion.

The automaker plans to focus on manufacturing large sport-utility vehicles and electric models for its core India market, where it has lost ground to competitors such as Tata Motors and Kia Motors.
https://www.reuters.com/article/mahi...-idUSKBN29I0Z9
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