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Ford expands partnership talks with Volkswagen and Mahindra to cut costs

September 28, 2018, 08:25 AM IST by Nikhil Puthran
Ford expands partnership talks with Volkswagen and Mahindra to cut costs

- Ford in talks with Volkswagen and Mahindra to expand product and technology alliances
- Volkswagen to help expand a commercial vehicle tie-up in South America and Europe
- Mahindra to help bring down the supply cost in India

At a recent global leadership meeting, Ford Motor Company CEO, Jim Hackett encouraged the company to put in motion the plans to restructure its business in order to cut down the costs. The latest developments are coming in at a time when the company stocks have already been trading at a six-year low rate since last month.

As part of plans to cut costs, Ford is working on expanding its partnership with other automakers from around the world to share the factory floor capacity and develop vehicles together. Reports indicate that the company is in talks with Germany's Volkswagen AG and India's Mahindra to expand product and technology alliances.

The discussions with Volkswagen, are reportedly focused on how to expand the commercial vehicle tie-up they previously announced and include South America and Europe in this plan - where Ford is losing money - and co-develop other types of vehicles. It is believed that the expanded alliance would give Volkswagen access to some of Ford's most profitable vehicles, including the Transit commercial vans and Ranger compact pickup trucks.

In an effort to bring down the supply cost in India, Ford is reportedly in talks with Mahindra and Mahindra. The first vehicle from the platform is likely to be launched in 2020. The twin efforts are meant to help remake Ford in conjunction with the $11 billion restructuring blueprint it outlined for the next three to five years. Ford needs to improve profitability because it is investing billions of dollars to develop electric and self-driving vehicles, and gearing up for a major rollout of products over the next two years.

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