Competition Tribunal approves Mahindra-Ford joint venture
The tribunal believes the transaction will not lessen competition in the motoring sector
SA’s top competition body has given vehicle makers Mahindra & Mahindra and Ford the green light to establish a joint venture that will export vehicles manufactured in India across the world.
On Friday, the Competition Tribunal said it had approved the transaction without conditions. The two companies will now have a joint venture in a new company Ardour Automotive Private Ltd (Ardour).
Ardour, incorporated in India, will house the business of Ford India Private Ltd (FIPL), which is Ford’s wholly owned subsidiary.
Ardour will export vehicles manufactured in India across the world, the tribunal said in a statement. Mahindra & Mahindra, the Indian multinational established in 1945, has interests in a number of sectors, including automotive.
In SA, Mahindra SA sells passenger vehicles, tractors, construction equipment and generator sets. It recently set up a vehicle assembly facility in the Dube Tradeport special economic zone (SEZ) next to the King Shaka Airport in KwaZulu-Natal.
Ford manufactures and sells vehicles and has dealerships in eSwatini, Namibia, SA and Botswana. The company exports vehicles to Europe, the Middle East and Africa and imports the Figo and EcoSport brands from India.
When the two companies announced the joint venture in October 2019, Mahindra & Mahindra MD Pawan Goenka said emerging economies, including India, were expected to account for one in three future vehicle sales.
The tribunal said the Competition Commission had recommended the transaction’s approval without conditions as it is unlikely to lessen competition in the automotive market, saying, “No public interest concerns were raised.”