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Old 10th April 2019, 10:12   #31
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Default Re: Ford to end its solo drive in India; will hold 49% in JV with Mahindra

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Originally Posted by krish3 View Post
This is a win-win for both IMO.
...
Ford owners get access to a wider range of service centers, though we have to get the details on how this will pan out.
...
It is not a win for existing customers certainly. We know how the experience was for FCA customers when they had to get their vehicles serviced in Tata service centers.

It isn't a win for Ford too. They think they've reduced their risk by half, but it won't work out that way. Now, if the JV tries to sell rebadged Mahindra vehicles. We know how that went with Renault and Nissan. If they don't, but sell both vehicles in the same showroom, Mahindra will get preference.

It's a win for Mahindra, I think. They get the expertise from Ford's India operations and the assets (factories etc).

It will be a win-win for all only if Mahindra maintains the brand as a separate line with independent vehicle development. Like Hyundai - Kia. They're direct competitors owned by the same parent company.

Quote:
Originally Posted by CrAzY dRiVeR View Post
Technically, this is way beyond the FCA situation. Or even the VW situation.
...
Although Fiat is still independent, they won't have any operations in India in future. The engine sales will stop in a couple of years once the new BS6 regulations kick in. Maruti-Suzuki has already developed their own engine. They'll stop buying from Fiat.

For Fiat's customers, it won't matter because in a few years time, there will be parts shortage and long waiting times. It'll be the same case for Ford's existing customers too. There will be fewer and fewer Ford customers in future, and the brand may cease to exist fully.

VW's situation essentially doesn't apply to the end customers. It doesn't even impact VW group. Only the numbers move from one column(VW India) to the other (Skoda India).
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Old 10th April 2019, 10:17   #32
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Default Re: Mahindra and Ford to explore strategic cooperation in India & other markets

While there will not be benefits to Ford in terms making better cars, this'll allow presence of Ford in the Indian market as the losses will come down due to optimized sourcing.
Ford continues to sell in India till the Indian market grows further.
Remember Ford exited Russia recently after significant investments and there seems to be a slowdown in vehicles sales this year in India.

The question is what is the future lineup going to be. Are they going to bring global Ford models or not? Or are they looking at only rebadging Mahindra cars going forward?
Hope they get the new Puma and Escape along with the XUV 500 based Ford car by 2020.
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Old 10th April 2019, 10:26   #33
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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 benbsb29 View Post
Completely agree with you on the point above. Being a Ford owner in the Indian market, i recall the extreme resistance from friends and 'well-wishers' on the decision to buy a Ford and not a Maruti.
Precisely this view makes even a good car do badly during resale and then further discourages new players.

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Originally Posted by Chetan_Rao View Post
You're right, but the trick to survive in a herd mentality environment is to create your own. Look at Hyundai. Ford created a small one of their own, but then lost focus and tried to dance a jig they didn't know the steps to (mass market cars).
Easy to say that. Like I mentioned, (in my view), there are very FEW product positioning options in the Indian auto market. To name them
1. Most fuel efficient
2. Best resale

Other positioning points like
3. Build
4. Feature set
5. Interior Quality
6. Technology
7. Safety
etc are quite secondary and assigned lesser weightage by most buyers ( lets not take examples from the forum pls ).

So what is any manufacturer supposed to do ? Maruti is the king of both the above points, Hyundai has grabbed a bit from the rest. Where does that leave the rest ?

The related issue with this situation is that other players hardly get any economies of scale and that's a vicious cycle in terms of product updates and new launches
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Old 10th April 2019, 10:36   #34
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

The simple assumption being made in most posts (including my earlier post) is that - Ford dealers are likely to remain in operations even after this announcement.

However, I'm guessing a majority of them will jump ship after having seen the plight of GM dealers when they quit the market - even though Ford isn't quitting.

With brands like Kia, MG, Citroen, etc coming in - some on a very aggressive approach, existing Ford dealers might try to make the best of their investments by jumping on to a newer, more promising brand.

Best way forward in that scenario would be to sell all products under Mahindra brand and offer Ford dealers to switch to the Mahindra network as well.
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Old 10th April 2019, 10:42   #35
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Default Re: Ford to end its solo drive in India; will hold 49% in JV with Mahindra

Quote:
Originally Posted by CrAzY dRiVeR View Post

Whereas, Ford has left control of the steering wheel of their brand in the hands of Mahindra. A 49% stake most likely indicates that Ford will just try to sell rebadged Mahindra cars mostly going forward - a strategy that has almost never worked in the Indian market.
I think, with 49% still with them, they are all in for profits. They just don't want to be making big decisions. I think they will let the JV use the Ford badge, their cars and technology. Looks like a simple management change with little difference on the ground.
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Old 10th April 2019, 10:43   #36
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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

This lukewarm approach will only lead them to the GM and Fiat way eventually. I never thought Ford would do this ahead of Nissan or VW.
Nissan maybe, but VW has committed plans for their future products in India,
Success or Failure comes next but at least they show their India strategy in all their global presentations.
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Old 10th April 2019, 10:46   #37
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

I have recently booked a Ford Aspire diesel and will be taking delivery in a week's time.

Looking at the Ford History in India, they should have gone for 50-50 JV at least. What happens to the present customer base and people like me.

In the 49-51 JV case, the Ford vehicles after sales may take a back seat and can eventually lead to the Foreign partner exiting the JV as has been the case with Fiat - Tata. And this makes me very apprehensive about my new Ford Purchase.

I was happy with the way they were considering customer feedback to equip their vehicles with the necessary upgrades/features. And if I am not wrong they even turned profitable this year.

Do the experts believe I should go ahead with taking the delivery. The Ford Credit loan is sanctioned, down payment is made & the vehicle has almost got registered. Please provide your feedback.
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Old 10th April 2019, 10:49   #38
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

With Toyota-Suzuki collaboration coming in, it would become even more difficult for fringe players/companies with over-cautious shareholders to remain invested in Indian market.

Over next decade, I think Indian car market would be like:

1. Toyota-Suzuki
2. Hyundai-Kia
3. Tata
4. Mahindra-Ford
5. Honda
6. Few other niche/insignificant players like PSA, Skoda, MG, Renault-Nissan etc.
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Old 10th April 2019, 10:53   #39
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Quote:
Originally Posted by fiat_tarun View Post
If this is true, I am quite surprised with the decision to give Mahindra the driving seat in the JV. Ford India is now a profitable company
Ford India is profitable only because of exports. Mahindra is aggressive on the bargaining table and wouldn't have been willing, unless it had control. Furthermore, if & when Mahindra invests more money in the JV, Ford's share might drop lower than 49% too.

Quote:
Originally Posted by CrAzY dRiVeR View Post
However, I'm guessing a majority of them will jump ship after having seen the plight of GM dealers when they quit the market - even though Ford isn't quitting.
True, but an equal number of Ford dealers will be happy as the new Mahindras are pretty competent (XUV300, Marazzo). The next-gen XUV500 is on the horizon, while the Alturas is selling better than anyone expected.

Of course, how they manage to sell two competing brands under the same roof is an entirely different story. It's never succeeded in India.

Quote:
Originally Posted by AlokSharma View Post
In the 49-51 JV case, the Ford vehicles after sales may take a back seat and can eventually lead to the Foreign partner exiting the JV as has been the case with Fiat - Tata. And this makes me very apprehensive about my new Ford Purchase.
I think the 49% gives Ford a wait & watch approach. 5 - 10 years later, if it's still not interested in India, it can simply sell off its stake & exit India completely.
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Old 10th April 2019, 10:53   #40
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

All of this makes sense now. My manager had bought a discounted showroom display model Ecosport last month. It came with a warranty; and the warranty document was provided with Mahindra's "with you Hamesha" seal.
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Old 10th April 2019, 10:55   #41
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Makes me wonder if our laws and regulations are tilted in favor of local mass marketed products with very little safety or if this is something else.

Having a Figo at home, I can definitely say it's a fun car to drive (forget all that low end struggle for a second). It's still as new inside, nothing is broken and runs like a charm (except for the tractor diesel sound).

Given that successive governments are glacial in their approach to safety norms and global standards, I'd assume we may soon have a flood of cheap unsafe cars unable to match a future infrastructure or just fall to pieces.

While the above is a generalization, it is imperative on the government to keep up with what these international car makers (can) bring to the table and not try to truncate (4m rule - I am looking at you) higher quality for local mass market.
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Old 10th April 2019, 10:58   #42
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Quote:
Originally Posted by AlokSharma View Post

Do the experts believe I should go ahead with taking the delivery. The Ford Credit loan is sanctioned, down payment is made & the vehicle has almost got registered. Please provide your feedback.
Not an expert, but I don't think you need to be apprehensive about the purchase decision because of the news.
It is not that spare parts and service are going to become non-existent. The company is going to still exist in India , except that they have collaborated with Mahindra for operations and all we can do as owners, is to wait and watch regarding the servicing bit.
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Old 10th April 2019, 11:01   #43
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Quote:
Originally Posted by AlokSharma View Post
I have recently booked a Ford Aspire diesel and will be taking delivery in a week's time.
...
Do the experts believe I should go ahead with taking the delivery. The Ford Credit loan is sanctioned, down payment is made & the vehicle has almost got registered. Please provide your feedback.
I'm not an expert, but I'll pitch in my 2 cents. It depends on your specific situation. Answer these questions, and you can make a decision:
1. Did you consider any other cars? If so, why did you choose Aspire? What did it offer over others? Can you make do without these advantages?
2. It is unlikely to affect you in near future. You may end up with some issues like part shortage etc after 5 - 10 years? Are you ok with this?
3. How important is resale? This news will definitely affect resale negatively. Are you ok with this?
4. You may end up fighting with the dealer to cancel your booking. You may lose some money in the process. Is this ok with you?

I am in the same situation too. I have booked the Ecosport. I liked the car a lot over XUV300. I think I can live with the service issues. I don't care about resale. So, I'm going ahead with the purchase.
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Old 10th April 2019, 11:04   #44
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

Sensible decision by Ford, there is no point in wasting their resources in a country where majority of car buyers prefer/know only one particular brand. In the coming years Mahindra will benefit the most from this JV. I owned an Ecosport for a very short period, cannot digest easily if somebody compares it with a Brezza.
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Old 10th April 2019, 11:26   #45
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Default re: Ford to end independent operations in India; will hold 49% in JV with Mahindra

As a proud owner of both a Ford (Ecosport, I exchanged my Punto for it) and a Mahindra (XUV500) IMHO:
- at least Ford is not following their counterpart Chevrolet; they're not exiting Bharat, and thank God (and those American managers) for that.
- at least some MM vehicles can expect a better resale value than Ford cars
- my experience with Mahindra A S S is certainly better than Tata and Fiat
- Mahindra was making Armada and whatever at the time of Ford JV version 1.0. They're making far better vehicles this time.
- Mahindra will learn a lot from Ford, and Ford will learn nothing from MM
- if I read in this forum one day, (2030 perhaps) that "MM is acquiring the legendary US car maker, Ford", I won't be surprised. Would you?

Last edited by sandeepmdas : 10th April 2019 at 11:27.
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