Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover

GTO · 14th February 2014, 19:04

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Quote:

Japanese automaker, Nissan has announced that henceforth, its Indian subsidiary Nissan Motor India Private Limited will undertake marketing, selling and distribution of all Nissan-branded vehicles independently.

The manufacturer has terminated its contract with Hover Automotive Private Limited, which had been handling its operations in India since 2008.

Full News Article

Hover, however, says Nissan has no right to terminate the agreement and has released the following statement:

Quote:

At Hover Automotive India Pvt Ltd (HAI), we would like to inform all concerned that negotiations with Nissan are ongoing at this stage and it is premature to say any agreement regarding termination has occurred. HAI understands that Nissan wants to move quickly, but it is possible only with the cooperation and consent of HAI and we look forward to working with Nissan and are hopeful of an amicable resolution. Until then HAI expects to continue to be the sole and exclusive distributor for the Nissan brand of vehicles in India.

For the general benefit of Nissan India’s customers, media and all stakeholders, we would like to reiterate that Nissan does not have any legal basis for the termination of services of its national sales company- Hover Automotive India Pvt Ltd in India. The management at HAI has taken strong exception to the announcement this morning by Nissan. HAI reserves all rights and remedies available and will pursue the necessary course of action to protect interest of its employees and stakeholders.

Link to Full News Article

terra85 · 14th February 2014, 19:12

Hi,

Thanks for the update GTO, so who is going to send cars to the dealerships now Hover or Nissan and why did they have this issue in the first place .Does Renault also have a distribution company or they deal themselves .Regards.

Vid6639 · 14th February 2014, 19:22

Nissan is doing the right thing but definitely not going about it the right way. Quite comical to see this spat in public.

Wonder what happens in the interim? What about the dealerships? If Hover runs them do they still remain or does Nissan have to start afresh.

aaggoswami · 14th February 2014, 19:31

This certainly shakes the consumer confidence. I booked grand i10 diesel, had budget of Rs. 7 lakh. Micra was rejected by family as a) its slow selling and b) the dealership and A.S & S. remain a worry.
I was aware of Nissan not directly getting involved in selling cars and opted for a sort of "outsourced" solution. As a prospective buyer, Micra, even in Active form made tremendous sense. But I somehow felt Nissan to be lacking confidence in itself/products.

This move, though a seemingly bold move, comes at a time when Nissan is observing relatively consistent sales due to Terrano. Shows that Nissan played it way too safe and that strategy prevented them taking a strong yet confident move.

I see this too late, too little. But atleast now they take up the onus of their own products.

Equus · 14th February 2014, 22:59

Positive step as Nissan is taking the right steps to build a larger customer base here. After all the talk and the award (err), Ghosn is finally serious about the domestic market here!

I personally think Nissan has a big role to play in India over the next 10-15 yrs. They have India-fantastic products and the Micra is a fantastic example. Sunny should have sold a lot, lot more in the taxi segment but hasnt. Evalia too! Hope their own service network proves to be a game changer!

mints21 · 14th February 2014, 23:05

An alliance with HAI has proved to be a disaster for Nissan. It is only because of HAI that Nissan has faced difficulties in Indian market. Nissan has a strong and good product portfolio. They are struggling with numbers not because of faulty or inferior quality product range but because of HAI. Their termination of this alliance with HAI is a welcome step.

I am sure that they will manage to emerge as a strong brand in the near future. Indian customer has a liking for their products, trust their reliability but was shying away only because of After Sales service part. With this termination of HAI Nissan will be able to address this issue as well.

What is surprising me is the arrogance of HAI, they are trying to challenge the parent company. What can the dealers expect from them in their day to day business if they react this way with the parent company. Really tough to imagine the fate of dealers who were asked to deal with such an arrogant company (HAI).

thoma · 15th February 2014, 09:07

Quote:

Originally Posted by mints21

What is surprising me is the arrogance of HAI, they are trying to challenge the parent company. What can the dealers expect from them in their day to day business if they react this way with the parent company.

Very true. If at all they are given to continue, and how do HAI intend to please their boss, by fighting with the boss? That will be like a govt. organization then, just hanging on for the position and making all others life miserable, with an attitude not aligned with the top or bottom.

If at all there is a contract mentioning compensation upon premature termination, it is fair on HAI's part to ask for it, else why hang on when no one else wants you?

bejoy · 15th February 2014, 09:43

Quote:

Originally Posted by mints21

What is surprising me is the arrogance of HAI, they are trying to challenge the parent company.

From the public info:http://www.hai.net.in/corporate-info.htm

Quote:

Hover Automotive India (HAI) is the partner of Nissan Motor India Pvt. Ltd, to operate the Sales, Service, Parts, Marketing, Training & Dealer Development functions in the Indian Market for Nissan range of products.

They are partners in the venture, and it is evident that things are not going well between them. And the public stunts are just pressure tactics to relent other party to the demands, IMO.

mints21 · 15th February 2014, 10:50

Quote:

If at all there is a contract mentioning compensation upon premature termination, it is fair on HAI's part to ask for it, else why hang on when no one else wants you?

I am sure that Nissan will have no problem in compensating HAI to get rid of it. Moreover, compensation clauses are there in such agreements but I am sure that the first right of refusal must be with Nissan.

HAI must be hoping to get a fair amount of compensation by using such tactics. I hope that HAI knows for sure that their days are numbered and they will not be able to fight with them legally. If it enters legal, Nissan will be able to prove without a reasonable doubt the extent of damage they had suffered at the hands of HAI. I think Nissan will be in a better position to sue them for bringing loss to their brand, market share and reputation.

phamilyman · 15th February 2014, 11:20

Hover must go!

The problem is quality of service more than anything else. In Delhi - Since Nath nissan shut down, my brother has been ruing his Nissan Micra purchase every service. I hope Nissan can take charge and straighten out the dealers to give the right quality of service that we expect from a Jap brand of its repute. The customers put their faith in Nissan brand and its engineering, not some two bit Hover which cant do a proper job of delivering on service.

AAAGoswami my man - After Tata Indica and now Micra - my brother is certain to buy a Maruti only. As a middle class married man with three kids having only one car, he needs peace of mind. Good engineering means nothing without great service. Your Hyundai choice is a good one.

rdhawan15 · 15th February 2014, 13:17

Hover will have to go and they are just looking at an exit cost. In the current situation, they should pick up a reasonable exit cost and move on. They won't stand a chance in going legal, though they may cause some pain in the interim to Nissan.

The decision is a good move by Nissan as it will bolster its customer outreach and enhance customer satisfaction of Nissan owners.

thoma · 15th February 2014, 13:26

Quote:

Originally Posted by bejoy

From the public info:http://www.hai.net.in/corporate-info.htm

I think that is static content. After yesterday, Hover admits "Until then, HAI expects to continue to be the sole and exclusive distributor for the Nissan brand of vehicles in India"

Quote:

And the public stunts are just pressure tactics to relent other party to the demands, IMO.

I think otherwise.

"HAI understands that Nissan wants to move quickly but it is possible only with the co-operation and consent of HAI and we look forward to working with Nissan and are hopeful of an amicable resolution"

I really don't get Hover's attitude. Plain bullying? They ruined the relationship with dealers and still holds Nissan at ransom!

Quote:

When contacted, Nissan India spokesperson sent an email response to the HAI statement, saying, "Nissan carefully considered all options available to it and took appropriate advice before terminating. Due to the sensitive nature of this matter, we have no further comment. We are focusing on our Indian operations to ensure minimal disruption and to provide our customers with a seamless transition."

Nissan sources added that the termination came after several rounds of negotiations to end the matter amicably, which did not yield results, and that Nissan has only used the termination clause available in the contract with HAI and there was nothing illegal about it.

Source

SkyWalker · 15th February 2014, 14:39

can't comment on the legal aspects, but i am sure Nissan customers would benefit. The service and ownership experience was nothing exceptional and Nissan handling it directly is a positive sign.

mints21 · 15th February 2014, 15:33

Quote:

In Delhi - Since Nath nissan shut down, my brother has been ruing his Nissan Micra purchase every service.

The only diesel car I have fallen in love is Nissan Micra. I was not very happy with the sale and service of Nath Nissan as well. This is one reason I bought the car from DADA motors Jalandhar (Punjab) on my birthday. I decided to send my car to my dad in Jalandhar where he presently stays and he is very happy as they have a best service centre for Nissan.

Given some constraints DADA motors may have from Nissan or HAI the customers have never felt the heat of it.

Sommos · 15th February 2014, 16:39

In this case Nissan has not entered into agreement with the dealers.
All the dealership agreement are with HAI. What will happen to that if HAI refuses to cancel / terminate the agrrement ?

Secondly, Nissan will have to sign new agreement with all the dealers and that would be time consuming. Will there be any delivery of vehicles to the dealers until all this mess is settled ?

I hope Nissan would not let the customers suffer till all the issues are settled.

14th February 2014, 19:12	#2
terra85 BHPian Join Date: Sep 2013 Location: bangalore Posts: 171 Thanked: 190 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover Hi, Thanks for the update GTO, so who is going to send cars to the dealerships now Hover or Nissan and why did they have this issue in the first place .Does Renault also have a distribution company or they deal themselves .Regards. Last edited by terra85 : 14th February 2014 at 19:13. Reason: Sentence
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14th February 2014, 19:22	#3
Vid6639 Team-BHP Support Join Date: Jul 2006 Location: Bangalore Posts: 17,726 Thanked: 43,453 Times View My Garage	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover Nissan is doing the right thing but definitely not going about it the right way. Quite comical to see this spat in public. Wonder what happens in the interim? What about the dealerships? If Hover runs them do they still remain or does Nissan have to start afresh.
	(2) Thanks

14th February 2014, 19:31	#4
aaggoswami Senior - BHPian Join Date: May 2007 Location: Vadodara Posts: 4,982 Thanked: 2,930 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover This certainly shakes the consumer confidence. I booked grand i10 diesel, had budget of Rs. 7 lakh. Micra was rejected by family as a) its slow selling and b) the dealership and A.S & S. remain a worry. I was aware of Nissan not directly getting involved in selling cars and opted for a sort of "outsourced" solution. As a prospective buyer, Micra, even in Active form made tremendous sense. But I somehow felt Nissan to be lacking confidence in itself/products. This move, though a seemingly bold move, comes at a time when Nissan is observing relatively consistent sales due to Terrano. Shows that Nissan played it way too safe and that strategy prevented them taking a strong yet confident move. I see this too late, too little. But atleast now they take up the onus of their own products. Last edited by aaggoswami : 14th February 2014 at 19:32.
	() Thanks

14th February 2014, 22:59	#5
Equus Senior - BHPian Join Date: Sep 2006 Location: Bangalore Posts: 1,123 Thanked: 423 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover Positive step as Nissan is taking the right steps to build a larger customer base here. After all the talk and the award (err), Ghosn is finally serious about the domestic market here! I personally think Nissan has a big role to play in India over the next 10-15 yrs. They have India-fantastic products and the Micra is a fantastic example. Sunny should have sold a lot, lot more in the taxi segment but hasnt. Evalia too! Hope their own service network proves to be a game changer!
	(1) Thanks

14th February 2014, 23:05	#6
mints21 BHPian Join Date: Nov 2013 Location: India Posts: 840 Thanked: 1,409 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover An alliance with HAI has proved to be a disaster for Nissan. It is only because of HAI that Nissan has faced difficulties in Indian market. Nissan has a strong and good product portfolio. They are struggling with numbers not because of faulty or inferior quality product range but because of HAI. Their termination of this alliance with HAI is a welcome step. I am sure that they will manage to emerge as a strong brand in the near future. Indian customer has a liking for their products, trust their reliability but was shying away only because of After Sales service part. With this termination of HAI Nissan will be able to address this issue as well. What is surprising me is the arrogance of HAI, they are trying to challenge the parent company. What can the dealers expect from them in their day to day business if they react this way with the parent company. Really tough to imagine the fate of dealers who were asked to deal with such an arrogant company (HAI).
	(3) Thanks

15th February 2014, 11:20	#10
phamilyman Senior - BHPian Join Date: Jul 2007 Location: Gurgaon Posts: 5,968 Thanked: 4,641 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover Hover must go! The problem is quality of service more than anything else. In Delhi - Since Nath nissan shut down, my brother has been ruing his Nissan Micra purchase every service. I hope Nissan can take charge and straighten out the dealers to give the right quality of service that we expect from a Jap brand of its repute. The customers put their faith in Nissan brand and its engineering, not some two bit Hover which cant do a proper job of delivering on service. AAAGoswami my man - After Tata Indica and now Micra - my brother is certain to buy a Maruti only. As a middle class married man with three kids having only one car, he needs peace of mind. Good engineering means nothing without great service. Your Hyundai choice is a good one.
	(2) Thanks

15th February 2014, 13:17	#11
rdhawan15 BHPian Join Date: Jan 2014 Location: New Delhi Posts: 182 Thanked: 428 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover Hover will have to go and they are just looking at an exit cost. In the current situation, they should pick up a reasonable exit cost and move on. They won't stand a chance in going legal, though they may cause some pain in the interim to Nissan. The decision is a good move by Nissan as it will bolster its customer outreach and enhance customer satisfaction of Nissan owners.
	(1) Thanks

15th February 2014, 14:39	#13
SkyWalker Senior - BHPian Join Date: Jul 2006 Location: Bangalore Posts: 1,531 Thanked: 136 Times	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover can't comment on the legal aspects, but i am sure Nissan customers would benefit. The service and ownership experience was nothing exceptional and Nissan handling it directly is a positive sign.
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15th February 2014, 16:39	#15
Sommos Senior - BHPian Join Date: Jun 2012 Location: CG07/ MH34 Posts: 1,311 Thanked: 1,455 Times View My Garage	re: Nissan India wants its own dealerships, Hover says NO! EDIT: R-I-P Hover In this case Nissan has not entered into agreement with the dealers. All the dealership agreement are with HAI. What will happen to that if HAI refuses to cancel / terminate the agrrement ? Secondly, Nissan will have to sign new agreement with all the dealers and that would be time consuming. Will there be any delivery of vehicles to the dealers until all this mess is settled ? I hope Nissan would not let the customers suffer till all the issues are settled.
	() Thanks

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