Nissan India to go solo with sales and distribution
Nissan wants out of its partnership with its national sales company, to take charge of sales, marketing as well as distribution
Today morning, Nissan announced that its Indian arm, Nissan Motor India Private Ltd (NMIPL) would start selling its cars on its own with immediate effect. It may sound vague at first, but if you will remember, up until now, Nissan did not handle the sales / marketing / distribution of its cars by itself, and outsourced it to Hover Automotive India (HAI), which was its sole distributor for all these years. Now, Nissan wants to part ways with it. Immediately.
The thing is, when Nissan entered our market, it decided to stick to producing cars at the start, and let another company (which happened to be HAI) handle the sales aspect for it. On paper, the solution seemed fine. In reality, though, the cars kept coming, but the sales...well, they never really took off, which sort of defeated the whole point of appointing HAI in the first place. Nissan hasn't given out any specific reasons for its decision to go out on its own, but you do feel that things not falling into place as planned triggered this decision.
Speaking about the split, 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."
How does it affect Nissan's current sales network? Not in a significant way, actually: the current dealer network will stay the same, with a chance of ex-dealers (who had opted out owing to differences with HAI) also re-joining the fray. As for the employees, Nissan is contemplating whether to absorb them or not. NMIPL maintains that it will ensure this transition is a smooth one.
But while Nissan mentioned that it has terminated its agreement with HAI already, HAI's Acting COO Richard Spitzer has rebutted the claim in an official statement a few hours ago, saying that "negotiations with Nissan are ongoing at this stage, and it is premature to say any agreement regarding termination has occurred". He also went on to point out that Nissan "does not have any legal basis for the termination of services of its national sales company".
Love may have been in the air today, but not for Nissan and HAI, clearly.