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Old 30th October 2012, 07:21   #1
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Default Nissan dealers refuse to take vehicles from the factory!

This is from today's (30th Oct 2012) Times of India Pune edition. Seems Nissan is caught on the wrong foot here.

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Chennai: Nissan Motor India is locked in a faceoff with its dealers because of which Nissan dealerships are learnt to have stopped taking supplies of vehicles in the last one week. The dispute is over the issue of Nissan’s master franchisee Hover Automotive India (HAI).
Source & Full Article

Last edited by GTO : 30th October 2012 at 16:16. Reason: No uploading of copyrighted content please. Also, keeping fair usage practices in mind, it is best to include an excerpt + link to full article
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Old 30th October 2012, 07:51   #2
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Default re: Nissan dealers refuse to take vehicles from the factory!

Looks like Nissan dealers are miffed at the onset of a master franchise. Obviously they will feel treated stepmotherly. Nissan should have envisaged this and have taken the dealers into confidence and got their buy-in before seeking out new dealership formats.

Hope this tussle is solved quickly and without much altercation. Otherwise, it has the potential to dent the customer's confidence in the brand.
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Old 30th October 2012, 08:36   #3
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Default re: Nissan dealers refuse to take vehicles from the factory!

That explains why I have not seen an Evalia on the road as yet
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Old 30th October 2012, 10:17   #4
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Default re: Nissan dealers refuse to take vehicles from the factory!

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Originally Posted by ajmat View Post
That explains why I have not seen an Evalia on the road as yet
I am confused.How has this dispute affected the sales of Evalia and not the Sunny or something else??
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Old 30th October 2012, 10:20   #5
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Default re: Nissan dealers refuse to take vehicles from the factory!

Was speaking to a someone in the know and the person admits that the situation would never have risen had the manufacturer followed the conventional channel management policies as is practiced by other OEM's in India.
Dealers are feeling miffed because of the step-motherly treatment that is being doled out to them by HAI and low involvement by the OEM in any operational matters.

In fact in India, it is better if the OEM controls the dealers directly instead of appointing a distributor. If the OEM handles dealers well, (ask any Hero Honda dealer), they get very good support from their dealer community which can see the OEM through even when the market goes through a lean patch.

Dealers are now thinking Renault might be a better bet because of their dealer management policies are not through a distribution company, they are more aggressive in their product strategy and very supportive to their channel partners.

Apart from NML, Tata Motors and VW Group distributes their vehicles through a distribution company , but in both these cases the distributors are 100% subsdiaries of the OEM themselves, rather than a 3rd party which is used by Nissan.

Last edited by arjab : 30th October 2012 at 10:22.
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Old 30th October 2012, 10:31   #6
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Default re: Nissan dealers refuse to take vehicles from the factory!

India's manufacturing scenario is going for a toss.
Some suffering with manpower management.
Some suffering with inconsistent quality of manufacturing.
Some having service woes.
And, now this.
wouldn't this result in price hike ?

Customer satisfaction is a forgotten word these days.
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Old 30th October 2012, 13:08   #7
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Default re: Nissan dealers refuse to take vehicles from the factory!

Read it in today's TOI and feel bad about the dealers and same for the customers of Nissan. Nissan is considered a premium over Renault just like VW is to Skoda. But if this problem doesn't solve, Renault might get an upper hand.

Considering dealers make profit on after sale service rather than selling of cars, so with less Nissan cars in the market, dealers workshop facilities remain underutilized.

1 or 2 months back where I stay, there was the Orion Nissan at Sanpada, Navi Mumbai and he changed the dealership to Fiat. I was shocked considering Nissan is an upcoming brand compared to Fiat which is doing very less business.

After the above TOI report now the Orion Nissan dealer switch seems understandable.
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Old 30th October 2012, 13:32   #8
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Default re: Nissan dealers refuse to take vehicles from the factory!

Quote:
Originally Posted by KINI View Post
I am confused.How has this dispute affected the sales of Evalia and not the Sunny or something else??
Evalia has just been launched but the dealers have not sold them due to dispute. Sunny has been on sale much before the dispute and Nissan dealers might be selling those stock
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Old 30th October 2012, 15:32   #9
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Default re: Nissan dealers refuse to take vehicles from the factory!

Quote:
Originally Posted by el lobo 6061 View Post
Nissan is considered a premium over Renault just like VW is to Skoda.
I thought that it was the the other way around ( i,e., Renault is the premium version of Nissan. ).

Quote:
Originally Posted by vikrantj View Post
Dealers say they have created workshop facilities that are lying unused due to low domestic sales.
Interesting. Here in Coimbatore, Nissan's have a considerably good presence.

Even my visit last week to Ramani Nissan, after the encounter with rats in engine bay, I have observed that the workshops were running full capacity.

When I called my sales associate about this issue, he said that - the dealerships were fighting about this since the last year. They have talked to Nissan management and are expecting the management to take over from HAI soon. He also added that Nissan won't and can't leave the issue as they have invested a lot of money ( around 5000 Cr ) in facilities and it would be very hard for them to leave out local market.
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Old 30th October 2012, 16:29   #10
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Default Re: Nissan dealers refuse to take vehicles from the factory!

Nissan's after-sales in India sucks! Shows the outcome of a disconnect between the manufacturer & its dealerships (which are really the face of the company). If a customer complains, Nissan basically has nothing to do with it (other than forward the complaint to HAI).

The Hover Automotive India Group has part of the same leadership as the erstwhile Ichibaan Honda (the dealership had a notorious reputation in Mumbai). The group is currently blacklisted by HDFC Bank who won't entertain any car loans for Ichibaan Nissan's cars.

I fail to see the value that HAI brings to Nissan. Clearly, HAI isn't able to deliver customer service, nor keep dealerships happy. Does Nissan want to end up with a situation wherein neither car owners nor dealers are satisfied?
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Old 30th October 2012, 16:41   #11
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Default Re: Nissan dealers refuse to take vehicles from the factory!

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Originally Posted by GTO View Post
Does Nissan want to end up with a situation wherein neither car owners nor dealers are satisfied?
They are pretty much on the path to self destruction even if they don't want to end up like that. I can imagine the anxiety among the customers who got deliveries during navaratras and saw this article in the newspapers today. All of them must be cursing the day the took the decision to use their hard earned money to buy a Nissan.

Nissan must do something immediately to reclaim the trust of existing customers and to inspire confidence in prospective ones before people start saying no to otherwise decent products.
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Old 30th October 2012, 17:14   #12
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Default Re: Nissan dealers refuse to take vehicles from the factory!

Well, I didn't know that this Hover Automative is a private run company, that is *independent* of Nissan. Always thought it was some kind of wholly-owned subsidiary of Nissan India. Moez Mangalji & GM Singh, are two gentleman who own 'Hover India Ltd' and I suppose G.M. Singh is the one who owned Ichibaan Honda.
http://www.hai.net.in/corporate-info.htm

Maybe Nissan thought more about focussing on exports and setting up manufacturing leaving domestic operations, sales & service to a private distributor, but then the dealers & customers should have been warned beforehand that they would be left to the whims and fancies of a private entity whilst Nissan was building up their base in India or concentrating on exports and may on more than one ocassion leave their customers high & dry and out to fend for themselves.

From what I have seen of the Indian automative scene right from entry of Skoda is that the players in terms of the main dealers in the big cities are limited and even the ones who screw up bad in customer service and soil their clothes, always manage to acquire a fresh set of clothes and become dealers for a newcomer. These guys always keep circulating in the market in one form or the other like nasty odor that just won't go away.
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Old 30th October 2012, 18:29   #13
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Default Re: Nissan dealers refuse to take vehicles from the factory!

All, i need some information.

I dont understand some of the points "Nissan dealers are upset with the company's 'step-down approach' of a master franchisee which they claim can't work here."

I dont understand, when a Manufacturer is making cars in India, Why they are handling the control to a Franchisee?
Are there any advantages by having a Franchisee independent from Factory/Company?
How come the Dealers would be at a loss? The Dealer gets the stock from either Company or Franchisee and sells it. Makes profit on car + service provided + spares sold. How the presence of a Franchisee affects the dealers?

Pushing more volumes of cars would be dealers task too. The more he pushes into market + The better service provided to customers, the more money he makes. Agreed that Some money should be spend by Company in advertizing. But Dealer can promote by advertizing in Malls and other stuff.
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Old 31st October 2012, 15:04   #14
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Default Re: Nissan dealers refuse to take vehicles from the factory!

It is very unlike a Japanese OEM to operate this way. The Japanese view their businesses much like they view their lives and apply similar philosophies.

Taking a quick short-cut to enter India through a distributor instead of doing it themselves is not the way a Japanese OEM typically operates. Especially when they have set India as an important market.

It is only in countries where there is no manufacturing base that OEMs opearate through such partnerships (Latin American countries like Chile for ex.)

Take a look at Honda in India. They took over the minority stake by SIEL to become an independent entity. This way of operation of Nissan has baffled me since the beginning. Now, things seem to be going further south.
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Old 31st October 2012, 15:54   #15
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Default Re: Nissan dealers refuse to take vehicles from the factory!

Quote:
Originally Posted by GTO View Post
Nissan's after-sales in India sucks! Shows the outcome of a disconnect between the manufacturer & its dealerships (which are really the face of the company). If a customer complains, Nissan basically has nothing to do with it (other than forward the complaint to HAI).
It seems that Renault is being offered at a premium to Nissan (like in the case of Pulse, Scala) and unfortunately for Nissan customers, service quality could be a differentiation. I am getting skeptical of this tactic and this seem too close to the case of VW-Skoda difference in customer satisfaction.

Maybe it is all planned. Not that bad service from Nissan/Skoda is intentional, but the better service from Renault/VW is. Maybe they just don't focus too much on customer satisfaction of the lower brands
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