Friday, January 7, 2011

US Mahindra-Navistar Alliance: A Possibility

Hope is fading fast for a timely resolution to the battle for distribution rights to sell the first Indian made pickup trucks in America.
Over the last six months, Americans anticipating the launch of Mahindra’s TR20 and TR40 diesel pickups have instead witnessed a war of words played out in US courts, UK arbitration, and scalding press releases. The conflict between US based distributor, Global Vehicles USA (GV), and Indian industrial conglomerate and automaker, Mahindra & Mahindra Ltd (Mahindra), has played out like an epic Hollywood divorce.

The occasional glimmer of hope that Mahindra and GV could resolve their differences and bring TR pickups to market have regularly led to solemn disappointment for hopeful customers. The resulting rollercoaster ride has left some potential buyers barfing at the exit and others running to get back in line for another ride.

Recent statements by Pawan Goenka, automotive sector president of Mahindra & Mahindra, pours more fuel on the fire:

"There is always the possibility of having an alliance with Navistar in the US as we have an alliance with them in India already, but nothing has been finalized yet,”

Sentiment in the Indian press indicates that Mahindra does not have any interest in continuing it’s partnership with GV no matter how the legal battle ends. Mahindra officials refuse to comment on the lawsuit, and little word has made its way out of GV’s Alpharetta, Georgia headquarters in months.

Although Mahindra seems bent on bypassing the company who laid much of the groundwork for their US automobile entry (GV), they have consistently stated that they see the US as a key strategic market for their brand. Judging by their acquisition of Korean automaker, Ssangyong Motor, and the development of more worldly vehicles like the W201 SUV, Mahindra is on track for launching US products… some day.

Source: Business Standard


Anonymous said...

Well, I was a potential customer very interested in Mahindra's trucks, but it looks like they've screwed up their distribution channel before anything got started. They could have been a contender.

- john

Anonymous said...

Navistar could solve the chicken tax but would add production costs r/t US employee overhead.

On the otherhand, would Navistar trust M&M? Would US consumers?

Answer is likely no. M&M shot their wad and are now dead on arrival.

Anonymous said...

I have to agree with 2nd anonymous. Mahindra has broken the trust of everyone; potential consumers, potential dealers, enthusiasts, and their partners.

And its not just GV, they even back-stabbed the partners of their electric car subsidiary.

Broken trust everywhere.

Honoring contracts is at the core of American life. We do it even when it means letting criminals get away with it (like Enron execs; we did not break their contracts, because contracts are sacred). Americans are just not going to understand Mahindra's going back on their word.

Mahindra comes from culture where breaking a contract is just a matter of paying the right amount of bribe. It will take them a long time to understand American culture and ethics.

By then, it will be too late.

Anonymous said...

I went ahead and got a Tacoma. I'll check back in seven or eight years.

Anonymous said...

Well, for about $15K Diesel Toyz will put a 3.0L Toyota TDI diesel in your pickup/Tacoma/4Runner...

Anonymous said...

There is a pretty concerted industry effort afoot to keep out affordable diesel cars. Looks like VW was pressured to drop their eminently logical diesel/Hybrid, apparently to be able to keep playing in the USA market with their regular cars. All hail Prius/Fjord Exploder/Volt...

Anonymous said...

I agree with above about the US trying to keep hybrid diesels out. People need to realize the benefits of clean burning diesel and speak up.

Mahindra lost me as a customer. I've been waiting for the last 2 years, but I couldn't wait any longer and bought a Tacoma.