[MaxTorque]

I still don't understand the logic behind Nissan's decision to bring Hover Automotive for dealing sales and service. Now they are facing the results of a bad decision. I am sure both of them will have their own logic to explain their stand.

Anyways Nissan has an upper hand as they would have kept all provisions for this in the agreement terms and conditions. Anyways we need to wait and see the outcome of the spat.

[Anand3553]

I have a gut feeling that Nissan is trying to rejuvenate its brand value in India with the Datsun brand. How about providing the new Datsun customers a good service experience and letting the common man know that the same service experience will be provided for the Nissan brand as well. Wouldn't that be reassuring for prospective customers?

[rdhawan15]

Originally Posted by MaxTorque

I still don't understand the logic behind Nissan's decision to bring Hover Automotive for dealing sales and service. Now they are facing the results of a bad decision. I am sure both of them will have their own logic to explain their stand.

Anyways Nissan has an upper hand as they would have kept all provisions for this in the agreement terms and conditions. Anyways we need to wait and see the outcome of the spat.

Probably, Nissan was unsure about the market and whether Nissan products will be accepted well in the market. I believe Terrano has been successful and Nissan realizes that they have better prospects than they may have initially thought. Hence, they want to provide own support to the customers so that Datsun can bring them more success.

They made mistakes; but they are owning up their initial follies and that's a good thing. Things ought to get better for Nissan in India from here on.

[Safety is Param]

I may be wrong, however, after observing atleast thrice, I see no "Nissan" branding in Datsun's TV commercial. The only words I see are "Datsun" and "Go".

Also, the commercial displays the car only at the fag end of it. Rest of the commercial just shows people jumping here and there.

The current Maruti Celerio's Ad and the ealier Ad of Ertiga are examples of how a car commercial should be.

Originally Posted by MaxTorque

I still don't understand the logic behind Nissan's decision to bring Hover Automotive for dealing sales and service. Now they are facing the results of a bad decision. I am sure both of them will have their own logic to explain their stand.

I see nothing wrong with Nissan. And this is how any company enters into a new market.
- Honda 2 wheelers entered india as a technological partnership with Hero.
- Honda 4 wheelers entered india as a xxx partnership with shriram motors (shriram and Usha.)
- The same is the case with Toyota with Kirloskar's.
- Same is the case with MB, they entered with Tata's.
- Kawasaki, with Bajaj.
The best way to enter a new market is by having a collaboration with a powerfull Local party. The collaboration could be of technological support, manufacture and sell, or any other customized agreement.

Nissan's intentions were good. They entered Renault on their own & Outsourced Nissan's 50%. Effectively, they took 50% of the risk. Now, they are gaining 100% control. But it might turnout to be an expensive affair. Violating agreements terms isn't considered a good practice by law. Lets see how it goes.

Originally Posted by Safety is Param

I may be wrong, however, after observing atleast thrice, I see no "Nissan" branding in Datsun's TV commercial. The only words I see are "Datsun" and "Go".

Also, the commercial displays the car only at the fag end of it. Rest of the commercial just shows people jumping here and there.

Why do you want to see Nissan's Branding in Datsun's Go Ad ?
Datsun is a new brand. Its a low end brand or could be said as VFM brand, which is under Nissan.

When ever someone ask's my name, i say mine. I dont say my dad's complete name after mine. Same is the case here. Why Nissan's name?

[swiftnfurious]

Originally Posted by gemi_kk

I see nothing wrong with Nissan. And this is how any company enters into a new market.
- Honda 2 wheelers entered india as a technological partnership with Hero.
- Honda 4 wheelers entered india as a xxx partnership with shriram motors (shriram and Usha.)
- The same is the case with Toyota with Kirloskar's.
- Same is the case with MB, they entered with Tata's.
- Kawasaki, with Bajaj...

As far as I know, it was a rule sometime back that a foreign brand had to tie up with an Indian partner for operations here. After a fixed tenure, they could break up and go solo.

I do NOT think we have that mandate now a days and companies can come and start operations on their own.

On the other hand, I do NOT know whether Hover even stands a chance in the case. Most likely, all parent companies come with a clause that "we can terminate the contract with or without reason...." and Nissan also should be having this in the contract, which means there may NOT be a problem in the first place. And I hope they come out quick and build the operations in a smooth way.

Originally Posted by swiftnfurious

As far as I know, it was a rule sometime back that a foreign brand had to tie up with an Indian partner for operations here. After a fixed tenure, they could break up and go solo.

I do NOT think we have that mandate now a days and companies can come and start operations on their own.

On the other hand, I do NOT know whether Hover even stands a chance in the case. Most likely, all parent companies come with a clause that "we can terminate the contract with or without reason...."

Not sure about the law to have a tie up with an indian brand.
I was aware of only the one law which states that, the top executive of indian branch of the company should be an indian. This was a mandatory one.

Mate, Who would like to sign a one sided contract ? there must be some clause hidden deep inside. If not, why having a contract with hover?

[swiftnfurious]

Originally Posted by gemi_kk

....Mate, Who would like to sign a one sided contract ? there must be some clause hidden deep inside. If not, why having a contract with hover?

I think even with the contract, Nissan would have an edge. If NOT Hover, someone else would have taken up the distribution. Hover mostly benefited out of some margins in the operations.

To me, this sounds similar to a corporate-employee relationship where the employee will benefit from the salary paid and also where the corporate can terminate the employee with compensation. Just my guess though.

[Safety is Param]

Originally Posted by gemi_kk

Why do you want to see Nissan's Branding in Datsun's Go Ad ?

I don't care what branding they do on the Datsun

Based on some of the articles online, people have been advised to visit a "nearby Nissan showroom" for further information on Datsun. As of Feb 14 the bookings are also being accepted.

Datsun will not be having a dedicated showroom, but will be sharing space in an existing Nissan showroom, although the brand will have it's own dedicated force (salesman, etc.)

Upon checking Datsun's website, the email & correspondence address provided are that of Nissan.

So, I thought, it would be a good idea to append "Brought to you by Nissan" in the commercial so that the emerging brand gets noticed.

After all, it's a good idea to append your Father's name unless the kid has established a name for himself (this reply is not in your context, but to gain momentum by leveraging the Parent company's name)

[MaxTorque]

Originally Posted by gemi_kk

I see nothing wrong with Nissan. And this is how any company enters into a new market.
- Honda 2 wheelers entered india as a technological partnership with Hero.
- Honda 4 wheelers entered india as a xxx partnership with shriram motors (shriram and Usha.)
- The same is the case with Toyota with Kirloskar's.

Agreed with you. But there is a big difference between those you have listed and Nissan-Hover Alliance. All those alliances were for entire operations of the business ie Technology, Manufacturing and Distribution. In Nissan's case they outsourced one of the most critical function to Hover. Which was a mistake.

Originally Posted by swiftnfurious

As far as I know, it was a rule sometime back that a foreign brand had to tie up with an Indian partner for operations here. After a fixed tenure, they could break up and go solo.

There was a rule like you have mentioned. But that was based on equity partnership, 49:51 % or so. This rule was abolished in 1998-1999. After this only Honda 2 Wheelers entered India as a 100% subsidiary of Honda Motors, Japan. Currently there are many company's operating in India without an Indian partner.

Originally Posted by MaxTorque

There was a rule like you have mentioned. But that was based on equity partnership, 49:51 % or so. This rule was abolished in 1998-1999. After this only Honda 2 Wheelers entered India as a 100% subsidiary of Honda Motors, Japan. Currently there are many company's operating in India without an Indian partner.

Damn, the moment this discussion came up in this thread, my mind started pondering on what could be the case, is it true, True?

The actual reason is. Any new company could come into our country with prior permission and they can start a company. Only clause being Top management of Indian branch should be an indian. The limitation being, They cannot go public. No equity, No trading on our markets.

However, if the company wants to go public, then the local partnerships, etc etc come into the picture. If not, No clauses. The best example could be the US based software companies, which started in india around 1992 or so, They weren't listed, they were running.

[GTO]

As expected, Hover has taken the matter to court:

Hover Automotive India (HAI), the firm that sold and distributed Nissan cars in the country, has dragged the Japanese auto maker to court over termination of their agreement.

"HAI has already exercised legal options available to it to have the purported termination established as invalid and wrongful," the company said in a public notice.

It, however, did not disclose in which court the case has been filed. Spokesperson of HAI also declined to disclose, saying the company cannot comment beyond what has been put up in the public notice at the moment.

Full Economic Times Article

[GTO]

There's definitely something cooking, and it seems to be going Nissan's way.

First, Hover hasn't provided any followup information on their court case against Nissan (withdrawn???).

Now, their website www.hai.net.in has been taken down on "maintenance" reasons. Note: The control of this website was with Hover, not Nissan.

[Aditya]

Hover Automotive India is in the process of winding up operations. The company employs about 180 people, who have been told that they will be kept on rolls for three months, starting March 2014. However, they will not be paid and have been told to look elsewhere for jobs.

Link to Team-BHP News Article

[GTO]

Good riddance, I say. Hover destroyed Nissan's sales & service reputation & frustrated dealers. It single-handedly angered everyone....customers, dealers & Nissan!

The body blows that Nissan's reputation took is also well-deserved. Nissan should have known better than to take shortcuts and outsource its entire sales & service network to a 3rd party. Maruti, Hyundai etc. are not fools to invest time & money in their dealerships.

Question is, can Nissan do better now that it's at the helm of affairs? Only time will tell, I guess. At the end of the day, the dealerships are the same. Their attitude is far from customer-centric. The people remain the same....will reporting to Nissan instead of Hover change their professionalism? I hope so. Nissan is going to have to be very, very strict & disciplinarian (think, Maruti levels) with its dealerships.