As part of its wide-ranging partnership discussion with US car maker Ford, Mahindra & Mahindra has started exploring potential of getting into markets of Indonesia, Russia and penetrate deeper into the South African market.
Speaking on the side-lines ahead of the new vehicle Marazzo launch in Nashik, Pawan Goenka, MD of Mahindra & Mahindra said, “We are exploring various aspects with Ford – manufacturing, sourcing, engineering or even at retail front. But things are at a very initial stage to conclude what aspect we will be partnering.”
South East Asia is one of the key emerging market cluster where Mahindra does not have a presence and Ford may help maker of Scorpio to enter the critical markets of Indonesia or Thailand, likewise in Russia.
However Mahindra has recently invested independently in its own facility in South Africa, despite Ford having a sizeable manufacturing facility. There Mahindra may look at using Ford’s distribution, sourcing or aftermarket support.
It has been almost a year since, Mahindra & Mahindra and Ford Motor Co. announced a strategic alliance to explore cooperation on products, technologies and distribution including future mobility programmes, connected vehicle projects and electrification of cars among other areas. The current discussion marked a reunion of sorts after the two ended a joint venture in 2005.
Mahindra & Mahindra has already helped Ford to penetrate into 20 tier II to tier III cities with its own dealer network set up to sell its vehicles with a different customer interface but a common service infrastructure.
Already Mahindra’s sourcing team is helping Ford Motor to source locally and bring down the cost which has already started helping the US car maker to bring down the cost. According to people in the know, Ford is of the opinion that Mahindra’s cost structure is about 10-12% lower than Ford and already teams have started working on reducing cost.
To be sure, apart from initiatives with Mahindra and measures taken internally, Ford has already reduced the cost by 37% in the last couple of years.
On the products front, Ford is likely to offer its compact car platform B562 to Mahindra to use it for electric sedan and it is likely to use Mahindra’s new generation XUV platform W601 for a C segment SUV in the future.
Source: Economic Times