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Old 12th April 2019, 06:42   #151
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Contrary to popular perception, Indian Automotive industry actually works on wafer thin margins when compared to global markets. I know people without knowledge of the investments required in the industry will passionately debate this.

For companies to show returns on their investment, it requires long term India specific focus. The American companies are particularly vulnerable as they enjoy huge margins with the gas guzzling trucks and SUVs globally, especially in US. This is not considering the fact that it is an irresponsible business model.

With Donald Trump in office, regulations have been rolled back relentlessly allowing the high margin trucks / SUVs to be sold even more. All pointers indicate 5 more years for him come 2020. So, why should any American maker focus on India and it's Fuel efficient cars. It's just not good business.

In case EVs would have sold more, as in China, then there was a case for continuation. But we Indians would not pay 12 lakhs for a Tigor, would we. It's just not Value for money. To make Value for money stuff, you again need India specific investment - Not a good idea.
So summarising, the basic problem is that the global business model of American makers of big gas guzzling trucks and SUVs is not maintainable in India. So, companies like Ford and GM are bidding their adieus. Fiat Chrysler is next up with the upcoming demise of Diesel engines.

Last edited by Eddy : 12th April 2019 at 16:41. Reason: Spacing for better readability
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Old 12th April 2019, 09:23   #152
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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Originally Posted by thoma View Post
....announce new products for India and launch them at the earliest....
Let them sell what they've already launched first.

I've been following up for the Figo AT since launch day in March, no go. Chased three dealerships, then went directly to Ford for answers. Nothing except an apologetic shrug and 'we'll pass on your feedback to relevant team'.

I switched my preference to Freestyle T+ TDCi. Limited variant/color combinations available, and no commitment on when I can get what I want if I'm willing to wait. Even offered to stretch my budget and buy an Ecosport, same problem.

Ford's product planning is a mess, and has been for a long while. I'm a very disappointed current (and prospective repeat) customer who's on the verge of buying something else. Willing to stick with them, but they don't seem to want me to.

Last edited by Chetan_Rao : 12th April 2019 at 09:25.
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Old 12th April 2019, 10:00   #153
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

I am simply interested in knowing what will happen with existing dealers and service centres? Would they continue to operate independently?
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Old 12th April 2019, 11:14   #154
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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I am simply interested in knowing what will happen with existing dealers and service centres? Would they continue to operate independently?
I'll go one step further. How much confidence would Ford's part suppliers have going forward, to keep making parts for their existing products longer-term, even if the A.S.S. network is kept intact by the JV agreement? How long before dealers switch brands because working for Ford is not profitable?

I understand there's probably enough parts stocked up already for at least a few years worth of regular services for current customers, but how long before there are service centres but rarer/expensive parts are perennially on back-order, or only available via grey market/imports?

I'd really appreciate it if Ford can stop making wishy-washy PR statements of 'intent' and address specifics, or the consumers may do the honors and shut down their (already minuscule) India business for them by walking away. 'No intention to quit' is useless to a customer with a car sitting in a garage awaiting parts, or one sitting in the lobby to buy one (me included)?

Last edited by Chetan_Rao : 12th April 2019 at 11:16.
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Old 12th April 2019, 11:36   #155
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Folks...wanted to recheck. Has this been officially announced ? The original article on which this thread is based on is a speculative news on Reuters. So has either party confirmed this ? Else our title should reflect that in my view
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Old 12th April 2019, 12:29   #156
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

I am just thinking what will happen to brands like MG who have just landed in India? Will they not be looked with suspicion as well? Will it not impact their sales?
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Old 12th April 2019, 13:08   #157
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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Originally Posted by Chetan_Rao View Post
Ford's product planning is a mess, and has been for a long while. I'm a very disappointed current (and prospective repeat) customer who's on the verge of buying something else. Willing to stick with them, but they don't seem to want me to.
I understand your plight, have been following you on the other thread.

That including, reveals their commitment; lack lustre to sum up. Ford is struggling all over the world, so they have taken the strategy of downsizing and concentrating on markets they are comfortable with. Understandable. But what my 2 cents for them is to stop talking about commitment of 'not exiting', 'working to expand product portfolio', 'family for a change', etc. and go through the JV without wasting time.

Bold steps can save many a customer and the overall brand image. Go all out, market and support well the current products, work on newer products to be launched by the JV, hand over the good work to the JV along with the acquired aggression. Otherwise, if you go forward with less vigor, the JV too and hence the Ford name will set into oblivion faster.

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I am just thinking what will happen to brands like MG who have just landed in India? Will they not be looked with suspicion as well? Will it not impact their sales?
As I mentioned above, it's all about motivation. If MG is motivated enough, which I think yes by their current marketing strategies, they will play aggressively. And if the portfolio (products) and support (dealers) is good, they can get a foothold in our market.

Old players might wean off on their motivation with year after year of poor performance, though they have acquired all the knowledge of how this market works. Those who adapt and change can still hold on by rejigging strategies and management and even dealerships.
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Old 12th April 2019, 13:58   #158
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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As I mentioned above, it's all about motivation. If MG is motivated enough, which I think yes by their current marketing strategies, they will play aggressively. And if the portfolio (products) and support (dealers) is good, they can get a foothold in our market.

Old players might wean off on their motivation with year after year of poor performance, though they have acquired all the knowledge of how this market works. Those who adapt and change can still hold on by rejigging strategies and management and even dealerships.
I am not talking from MG perspective, but trying to imagine what potential car buyers would be thinking. Even if MG tries hard to portray their image (they have to, as they are just arriving), the buyers will start comparing this "foreign brand" with the two which left India. Dog-fooders will become less and many would like to have a wait and watch approach. This in turn will create same problems for MG which the Skoda/VW brands are having now.
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Old 12th April 2019, 14:38   #159
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Ford's decision should not be looked at as a standalone event. I am certain all international brands that operate alone in India are either considering the same or have begun procedures to do so. Multiple factors playing a role, but these are long term plans based on the future prospects within India. If a brand like Ford and Toyota seem to be moving towards joint ventures then it appears like they do not find it probable to gain market share keeping in mind the current state of affairs.
Could this also be a reaction to the eventual movement away from fuel to electric? Seems like none of these big brands feel their electric ranges will be viable in such a cost sensitive market especially with their minuscule market share. So, basically by going the JV route they increase their chances of succeeding when electrics enter the race. Everything will change if the Chinese get a hold of the market with their electrics. They did it with their phones. May be its time for a one plus car.
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Old 12th April 2019, 16:18   #160
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Cardekho's opinion on the speculation / rumours at https://www.cardekho.com/india-car-n...ival-23524.htm

Quote:
Mahindra and Ford are reportedly going to enter into a new joint venture, likely to be the end result of the collaboration that both the carmakers were earlier exploring, soon. The JV is still under negotiation and we expect it might spawn production-spec versions of the cars that Mahindra and Ford were co-developing. This JV is likely to coexist while leaving Ford and Mahindra as independent entities in India.

The JV is unlikely to affect Ford and Mahindra’s retail operations in the country, so both the carmakers should continue to operate in the market like they do currently.

Since Ford has plans to offer new products in the Indian car market, rumours surrounding the carmaker’s exit from India appear to be baseless. In fact, with a JV with Mahindra in its kitty, we expect Ford to introduce more SUVs in new segments in India. Along with jointly developed SUVs, we also expect Ford to continue offering indigenously developed products in India.
In my view, the JV rumour looks to be true and i don't Ford will have multiple entities in India. Nevertheless, the JV with Mahindra if done properly with set goals and a defined product lineup for the future years would do well. Remember, Ford and Mahindra have never been anatagonistic even during their parting so creating synergies would be easier.

The JV has to get the new Puma and the new Escape to India along with new XUV 500 based SUV to have a good lineup and continue the improved service experience.
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Old 12th April 2019, 16:21   #161
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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Originally Posted by gopalnt View Post
I am not talking from MG perspective, but trying to imagine what potential car buyers would be thinking. Even if MG tries hard to portray their image (they have to, as they are just arriving), the buyers will start comparing this "foreign brand" with the two which left India. Dog-fooders will become less and many would like to have a wait and watch approach. This in turn will create same problems for MG which the Skoda/VW brands are having now.
I don't think market works like that. For MG their work will be cut out. They will need to establish themselves as a brand. From their perspective they are a relatively unknown brand (say, unlike Jeep before they entered the market). And while they are trying to do that by adding a little bit of that Euro flavor with their ads proclaiming their heritage and Morris Garages name, the risk is as and when the market learns about their Chinese linkages. The India market has generally been a bit cagey and skeptical about Chinese automotive solutions till date. And that is the bigger worry for MG right now if you ask me.

The decision of Ford or VW etc. won't really bother the market too much in my opinion. In general, business always means some companies are folding up while the new ones are making their entry. Has been always so. The ones leaving rarely ever cast a shadow on the new entrants. Market gleefully accepts newer competition and as long as you can meet my aspirations, expectations and go beyond that you have just as good a chance as any other.

Last edited by Zappo : 12th April 2019 at 16:29.
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Old 12th April 2019, 16:37   #162
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

I am not surprised by Ford India decision on the JV policy with Mahindra. How will international brand survive with such profits in India. I too share the same feeling like few other in our forum. The Indian mentality is to go for cheap products from a brand like Maruti whose build quality is inferior and only focus is on fuel economy. I am proud and happy that after M800 we didn't touched any other tin can product. It is been Hyundai, Tata, Honda, Toyota, Ford & Volkswagen.

As per my analysis this is happening due to Maruti having 50% share in Indian automobile industry. I condemn this brand and will stick to my decision to never buy a Maruti, even if I have to go for an Indian brand I will better choose from Tata or Mahindra.

Just hope I get the same quality and service for my 2 year old Endeavour.
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Old 12th April 2019, 16:58   #163
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As per my analysis this is happening due to Maruti having 50% share in Indian automobile industry. I condemn this brand and will stick to my decision to never buy a Maruti, even if I have to go for an Indian brand I will better choose from Tata or Mahindra.
You spoke my mind! Reminded me the principles behind Ayn Rand's novels, specifically 'Atlas Shrugged'.

Majority of car buying Indians have cash but hardly any logic. Just like how you condemn that brand, i consider it as a curse to the industry for what they have become. Neither did they pioneer in bringing in safety nor eco-friendly technology. This despite having almost 50% market share whereas brands with far less footprint like our very own Mahindra and TATA are investing heavily on these fronts. Without fiat i wonder what would have been their fate.

Its really sad to see brands like these exiting our market and seeking out JVs in few cases. Be it politics or economics, we indians make poor choices and we deserve whats coming. Really sad. We hardly see cars that stand out in traffic these days. Just sad, pale, greyish-silver pieces of tin cans everywhere. Very depressing.

PS: no offense intended to anyone, just stating my opinion.
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Old 12th April 2019, 20:52   #164
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

It couldn't have come at a more opportune time. I mean to refer to the latest episode on the hugely popular Grand Tour Season 3. The name of the episode reverberates with the general outpouring this thread has received over the past couple of days.

"Funeral for a Ford"

Casting back in time to the stylishly hip even for the groovy 60s, Ford Cortina and its flash-akin brother Lotus Cortina, to the revered (and robbed) Sierra Cosworth, to the largely popular and modern Mondeo - the series finale showed just how much adore and amore Ford has enjoyed in those neck of the woods. But what stung out from the extraordinary recital of Ford's envious history, is to almost spectacularly fall off the grid. The amount of personal feelings from 3 assumingly sexagenrians is staggering, as they recounted their childhood fallacies of falling for what were really some terribly handling cars. But that's what binds the threads to our childhood, youth and the old age. The progress, netted with experiences. I still fondly remember the achingly beautiful and muscular Ford Ikon in a bottle green colour that my dad picked up in the early 2000s. I didn't know much about driving then, but I knew how a car lunges ahead if not careful with your left foot.

This decision from Ford is progress. At times, when they are culling their hope on sedans in their own backyard, and pulling the plug on the effervescent yet omnipresent Mondeo in the UK, it really doesn't need a beautiful mind to figure why they would not consider India to be a breading ground. Through their trials and tribulations of the past 3 decades and more, I cannot imagine the management to be left as flustered at the snail's pace of progress in the market. The ubiquitous leaders, saddled with their foibles still gather the money, whereas some honest minded manufacturers are relegated to being scavengers. Let this episode be a poignant reminder of the deep cavern and darkness of our self-proclaimed great market, which honestly is as flawed and speckled as moon. As for me, still optimistically naive to pick up a Ford as my next car, new or otherwise. The love for progress doesn't trounce my experience, when I fell in love with Blue Oval in dark green hue.

Totally OT, but had to get this out. Sorry!
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Old 13th April 2019, 01:17   #165
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

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Originally Posted by achilles101 View Post

https://www.cardekho.com/india-car-n...ival-23524.htm

Quote:
Mahindra and Ford are reportedly going to enter into a new joint venture, likely to be the end result of the collaboration that both the carmakers were earlier exploring, soon. The JV is still under negotiation and we expect it might spawn production-spec versions of the cars that Mahindra and Ford were co-developing. This JV is likely to coexist while leaving Ford and Mahindra as independent entities in India.

The JV is unlikely to affect Ford and Mahindraís retail operations in the country, so both the carmakers should continue to operate in the market like they do currently.

Since Ford has plans to offer new products in the Indian car market, rumours surrounding the carmakerís exit from India appear to be baseless. In fact, with a JV with Mahindra in its kitty, we expect Ford to introduce more SUVs in new segments in India. Along with jointly developed SUVs, we also expect Ford to continue offering indigenously developed products in India.
I hope this is the actual case. Ford better put their PR machinery into action real quick, and curb rumours about their exit. Indian car buyers are extremely cautious and these rumours will hurt their brand.
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