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| Ford and Mahindra will form a joint venture |
A deal has been struck between Indian automobile company Mahindra & Mahindra and American conglomerate Ford Motor. The two companies will form joint ventures with an investment of Rs 1925 crore. Mahindra & Mahindra will develop and market Ford's products in India. Mahindra & Mahindra will hold 51% stake in the joint venture, while Ford will hold 49% stake.
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| Mahindra will hold 51% stake in the joint venture, while Ford will hold 49% stake |
This joint venture will distribute Ford and Mahindra brand vehicles to the emerging market of the world. As part of the deal, Ford is considering moving its Indian business into this joint venture.
Ford losses in India
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| Ford losses in India |
Ford's business in India is in loss and it has been a long-time discussion that Ford is preparing to consolidate its business in India. But Ford has decided to stay in the Indian business through a joint venture instead of completely shutting down its business here.
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| Ford is a popular car company in the US |
Ford is a popular car company in the US and its shareholders are under great pressure to keep the company profitable. Because of this, Ford has plans to save $ 11 billion in the next few years by restructuring its business worldwide.
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| Every car manufacturer is at a loss |
The Indian car market is in recession for the last 1 year. Every car manufacturer is at a loss. Ford has invested over $ 2 billion in India. It currently holds a mere 3 percent share in the Indian market. Ford India sales declined by 31.4 percent in August and the company sold just 5,517 vehicles in the domestic market.
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