Just days after Mahindra’s diesel-powered compact pickups were approved by the EPA for sale in the US, the Indian automaker apparently canceled its distributor agreement with Global Vehicles according to the message above that was posted to Mahindra’s Media site. Global Vehicles has had a deal to distribute Mahindra pickup and SUV models in the US since 2006, and has signed up 350 dealers to sell the Indian imports. Recently cracks in the relationship surfaced when GV sued Mahindra alleging that the manufacturer was delaying homologation for the US market. GV claims to have spent $35m preparing for Mahindra’s US launch, and dealers were said to have paid $200k apiece to obtain franchises. Meanwhile, Automotive News [sub] notes
The statement by Mahindra hangs a question mark over the 300 to 350 U.S. retailers who have signed franchise agreements directly with Global Vehicles, if the Alpharetta, Ga., company no longer is the distributor.
Nor is it clear that Mahindra has the power to terminate the agreement without a court fight.
They can be glad they’re not US Fiat dealers, shelling out $1 million each.
I think this puts a stake into Mahindra’s US sales hopes.
Gee. I don’t think I’d buy a truck from a company that engages in this sort of business practice. If this is how they time breaking with their partner who has invested heavily in getting them this close to introducing their products, I’m sure they’ll have some nasty surprises for anyone dense enough to buy one of their trucks.
I don’t blame Mahindra on this. GV sued Mahindra first. Surely GV was a little more in the know about Mahindra’s progress than the general public, and with the suit coming so soon before the vehicles finally passed EPA testing, it seems like GV was just trying to make a quick buck at the expense of Mahindra.
If I were running a business and one of my suppliers had the gall to sue me, I’d try my best to burn them to the ground as well.
Indian business, with the exception of parts of the Tata Group, are slimebags.
Death knell of Mahindra’s aspirations in the US.
if I were mahindra I would not drop them, is a bad karma, the law suit could drag on for long time, GV could slap on some injunction here as the law suit drags out.
One of the reason when Chery wanted to come here and looks like Chebby, and Chebby slap them with an injunction, they stopped they knew is unwise to go to court with a few hundred lawyers!
Mahindra may win if the law suit is in their home turf, no in USof A.
You reap what you sow.
There are no winners in this case.
If only they had listened to us way back when we told them to use their tractor dealerships.
+1, I’ve been saying this the whole time.
There’s even a Mahindra tractor dealer in my little hometown. Would have been interesting to see whether they could move a few Mahindra trucks to those same farmers. They sure don’t seem to have much trouble selling the tractors!
Used to work out just fine for IH back in the day.
They seem to be assimilating into American corporate culture quite well. Sue first, ask questions later.
Declaring war on your dealers is not a good 1st step to entering the US market. They will now have to fight a long war of attrition in Federal Court before they can start selling their pickups here.
I had high hopes for their product forcing one of the other pickup OEMs to offer a small diesel.
Yes, Indian business indeed.
Okay.
For the simplistic explanation crowd, assist please.
Where is the “main blame” to be placed…. Repubs or Dems? Lefties or righties? Conservatives or liberals?
I tend to have difficulties determining which “group” to blame for various economic and/or social maladies.
Thank thee for thine assistance.
It’s always Clinton’s fault, right?
With the current bunch, it’s Bush’s fault.
Too bad about this. It may not kill bringing the trucks in but will sure slow it down. Go with the tractor dealers!
The ‘chicken tax’ was passed under LBJ, so blame whomever you wish for its continuation.
If they would have displayed a strong track record over 2-3 years, I would have purchased the TR40.
Now what? I need a compact/mid sized pickup that gets 28+ mpg!
Have I said “vaporware” every time there’s been a Mahindra post? Why yes, yes I have.
It may be a low rent operation – but they are testing their vehicles in the USA and this one appears to have its steering on the left side of the dashboard.
http://jalopnik.com/5619491/mahindra-scorpio-shows-off-its-tennessee-two+step
We know very little about what is going on here. Did Mahindra make a mistake by hiring a distributor it cannot see eye to eye with? Or has GV done nothing wrong and Mahindra is to blame? I guess it is whichever one you want to believe. For me, I have no clue what is real, but I do know that Perez has been down this nearly exact road once before with his Romanian or Yugoslavian import deal that went into courts. Deja voo all over again. Everything I have read about Mahindra is that they are tough but professional, and I expect them to get the product right and take care of their customers… at the end of the day that is what will make them successful once they get past this mess. And yes, I need a high MPG diesel pickup too!!!