New Delhi: Mahindra and Mahindra Ltd is in early talks with its partner Ford Motor Co. to procure a vehicle platform on which the Mumbai-based company aims to build an all new electric sedan, two people with direct knowledge of the matter said.
In lieu of this platform, Mahindra will share its affordable electric vehicle technologies with Ford, which the American company plans to use in its entry-level cars such as Figo and Aspire, these people said on condition of anonymity. Ford in India has developed a platform Ka, on which it has built cars such as hatchback Figo and sub-4 metre sedan. Ka+ is a larger derivative of Ka.
“Pawan Goenka, along with his colleagues at Mahindra Electric, has inspected the platform while signing off on a partnership with Ford in September," one of the people cited above said, requesting anonymity. Pawan Goenka is the managing director of Mahindra and Mahindra Ltd.
“Ford will get electric technology of Mahindra. So far, that’s the only point of discussion in that direction," the person added.
A Mahindra spokesperson declined to comment on the story while a Ford spokesperson said that it is “too early to discuss" at this point.
Both the companies on 19 September said that they were exploring a strategic alliance to leverage each other’s strengths to address rapidly emerging challenges in the global automobile industry. The agreement between the two companies will allow them to combine their mutual strengths during a period of unprecedented transformation in the automobile industry, the companies said in a joint statement. The areas of potential cooperation include mobility programmes, connected vehicle projects, electrification, product development, sourcing and commercial efficiencies, distribution within India to improve Ford’s reach and into global emerging markets to scale up Mahindra’s network.
The second person aware of the matter said that both the companies have started to work towards putting in place teams, which will work closely in these areas.
The partnership seems to be on equal terms, with the Indian firm gaining from Ford’s advanced technologies and global network and the Bill Ford-led American automaker getting a stronger and bigger footprint in the lucrative Indian market. India is expected to become the second-largest passenger vehicle market by 2026 with annual volume of 13.4 million units per year (if the local economy grows at an annual pace of 7.5%), according to the Indian government.
While Mahindra will look for Ford’s support in markets such as Russia and South Africa, its immediate priority will be the electric vehicle space, which it wants to dominate after having “first mover’s advantage", said an industry expert.
“If the recent EESL (Energy Efficiency Services Ltd) bids are anything to go by, it is clear that other companies have already woken up to the phenomenon. The race towards electric mobility will depend on variety and affordability that a company brings to the table," the expert said, requesting anonymity.
Mahindra lost out to its rival Tata Motors Ltd for a government contract of 500 electric vehicles but later said it will match the lowest bid of Rs10.16 lakh per vehicle made by Tata Motors Ltd as it wanted to be part of the government’s electric mobility mission. Its own bid was Rs2.3 lakh higher per vehicle. Mahindra will lose about Rs3 crore on the 150 electric sedans that it will supply to the government.
The government contract (state-owned EESL is buying on behalf of government) for 10,000 vehicles in multiple phases could be too small for sales growth of any company but the frenetic action around it has kick-started the electric mobility in the country.