Hover Automotive India (HAI) Nissan India’s former sales and distribution partner is now winding up operations after Nissan officially terminated the partnership two months ago. As the future of the company looks weak, Hover has conveyed to its 180 employees to start looking out for jobs and have been put on a three months notice without pay. Six years after Nissan and Hover formed an alliance; the termination of the partnership came after Hover provided far from satisfactory sales and services to the customers of Nissan.
The termination didn’t go down well with Hover, who immediately issued a public notice terming Nissan’s action as “invalid” and “ineffective”. The company filed for for an interim and emergency relief against Nissan Motor Co. Ltd at the Singapore International Arbitration Centre. But, following the proceedings, Hover lost the arbitration as well. The company can surely foresee its future without business coming in from Nissan. Moreover, the concept of a master franchisee has not really worked in the country, and Hover proves to be a prime example.
Troubled times brewed up on Hover after dealers and customers voiced their opinion over poor sales and service from the company. Moreover, Hover was just adding another layer of margin that certainly did not bring any help in the falling sales of Nissan. Nissan’s displeasure was evident when the company announced that the ambitious Datsun brand will be marketed and distributed by the Japanese automaker itself.
Nissan which received rave reviews for the Datsun GO hatchback is now concentrating on improving the sales and service network for its products. The company managed to sell 38,217 units of its products last year, up from 36,975 units sold in the previous year. For Hover Automotive, it seems the end of the road, as the company too is pretty sure of what the outcome will be in the court after the legal proceedings come to an end after 2-3 months.
Source – Livemint