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Nissan-Hover Automotive relationship turns bitter

Nissan terminates exclusive distribution agreement with Hover

T E Narasimhan Chennai
The partnership between Japanese auto major Nissan and Hover Automotive India Pvt. Ltd, a sole distributor for Nissan brands, has turned bitter.

While Nissan Motor India Private Ltd (NMIPL) has said that it has terminated the distribution agreement with Hover Automotive, the later said that it is premature to say any agreement regarding termination has occurred.

In a statement Nissan said that it has assumed full responsibility for the sales, marketing and distribution of all Nissan-branded vehicles and parts in India, with immediate effect from February 14, 2014. Further details about the business structure will be announced in due course, said the company.
 

Responding to which, Richard Spitzer Acting COO, Hover Automotive India said  “negotiations with Nissan are ongoing at this stage and it is premature to say any agreement regarding termination has occurred”.

He added, 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.

"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,” he said.

Responding to which, Richard Spitzer Acting COO, Hover Automotive India said  “negotiations with Nissan are ongoing at this stage and it is premature to say any agreement regarding termination has occurred”.

He added, 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.

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,” he said.

Responding to which Nissan maintained that it has terminated that agreement.

Kenichiro Yomura, Nissan President, India Operations, said: “Nissan is now at a point of maturity in India where the time is right to establish our own marketing and distribution operations. Nissan’s priority will be to ensure a smooth transition from current operations. We remain committed to our customers and will continue to deliver high quality products and services.”

The company said that additional information about the business structure will be made available shortly. It may be noted, earlier this month, Datsun brand from Nissan family has said that it would go with its own dealership.

Hover Automotive India (HAI) was appointed by Nissan in 2012 as the sole and exclusive distributor for managing the marketing, sales, after-sales service, training & dealer development functions in India. Currently Nissan has 125 dealerships across the country and plan to scale it upto 300 by 2016-17.

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First Published: Feb 14 2014 | 4:40 PM IST

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