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Mahindra’s Bid To Enter U.S. Market Unraveling

Feud with erstwhile distributor deepening.

by on Oct.20, 2010

Will Mahindra's Pik-Up ever make it to the U.S. market?

The feud over Mahindra & Mahindra’s bid to sell vehicles in the U.S. is apparently deepening – and threatening to scuttle or at least delay its long-awaited launch in the American market.

Global Vehicles USA Inc., which considers itself the exclusive U.S. distributor of Mahindra pickup trucks, called on India-based Mahindra & Mahindra to begin building vehicles for sale in the United States and commit to a launch date.

But there’s a growing likelihood that any decision over who will actually represent the Indian maker in the American market will have to be decided in court.

A firm launch date would bring the Indian-based vehicle builder back into compliance with the arbitration clause of the distribution agreement between the two companies Global Vehicles said in a statement.

“Nearly 350 dealers have been ready to sell Mahindra trucks for more than three years,” said John Perez, chief executive officer of Global Vehicles.

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“If Mahindra executives were being truthful when they said that the trucks would be on sale by the end of the year, they should honor that commitment so dealers can start earning back the tens of millions of dollars they have invested in the brand.

“Binding arbitration will decide if Mahindra lied to Global Vehicles and our dealers about the status of the trucks and whether they broke the law when they attempted to arbitrarily terminate our distribution contract,” Perez added. “In the meantime, Mahindra is legally – and morally – obligated to conduct business as usual,” the statement said.

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