Competition Commission of India gives nod to Ford-Mahindra joint venture

MUMBAI: The competition watchdog on Monday gave its approval to the formation of a joint venture between Ford Motor and Mahindra and Mahindra and the subsequent transfer of the automotive business of Ford India to the new venture.

Mahindra & Mahindra had announced a joint venture (JV) with Ford Motor Company in October last year. The former planned to own a controlling 51% stake with Ford holding the remaining 49% stake in the new company, which was registered as Ardour Automotive Private Limited, a wholly-owned subsidiary of Ford Motor Company (FMC).

The marriage between the Indian outfit of Ford and Mahindra was pending approval from the Competition Commission of India, which came through on Monday.

Both Ford and Mahindra will continue to have their separate brands and dealerships in India, but vehicles will be co-developed and the companies will strategically manufacture vehicles for each other. Ford will benefit from Mahindra’s knowledge of the Indian market while the latter will be able to leverage Ford’s technological know-how and a global presence.

Both the companies will have equal representation on the board, but Mahindra will get to choose the chairman who will have the casting vote. The management will be appointed by the Mumbai-based company in consultation with its American partner.