Ford Motor Company and Mahindra & Mahindra Limited have signed a definitive agreement for a joint venture, which will introduce three new utility vehicles under the Blue Oval moniker.

The $275 million (around R4 225 952 500 at the current Rand-Dollar exchange rate) joint venture is the next step in the strategic alliance between the two companies, which the Mumbai-based automaker announced in 2017. The firms have since “strengthened’ the alliance with the signing of two additional agreements in October 2018, after which in 2019 it put pen to paper to jointly develop a new mid-size SUV for India and other “emerging markets”.

As part of the agreement, Ford will transfer its India operations, including its personnel and assembly operations, to the joint venture (of which Mahindra owns a 51 percent stake) that will develop, market and distribute Ford vehicles in India. Furthermore, both manufacturers’ products will be distributed to other markets, including Africa, Australia, the Middle East, and Russia.

According to Autocar India, this joint venture will see the development of seven new vehicles, three of which will be under the Blue Oval brand’s badge. Although these models will be co-developed, the companies will not lose their respective identities.

The first Ford to come out of the joint venture will be based on the XUV500 SUV and employ Mahindra’s “next-generation” 2,2-litre diesel engine, Autocar India reports.

“The joint venture will have a distinct product portfolio with shared platforms and powertrains, the newest technology, high quality and engineering standards from both Mahindra and Ford, at optimized costs,” Dr. Pawan Goenka, managing director of Mahindra & Mahindra Limited said.

In addition to these vehicles, Ford and Mahindra will focus on the development of electric cars.