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India’s Mahindra Sued by Would-Be Dealers

U.S. sales launch 4 years behind schedule and counting.

by on Jun.07, 2012

This would-be Mahindra dealer in Mt. Clemens, Michigan eventually found another franchise.

While few motorists seem concerned that India’s Mahindra & Mahindra’s U.S. launch is four years behind schedule – and counting – the delay has enraged plenty of potential dealers who reportedly ponied up millions of dollars in advance fees to reserve the franchise.

A Miami-based law firm has now stepped in and has filed suit against the Indian maker in federal court alleging fraud and misrepresentation.  The lawyers at Diaz Reus & Targ claim Mahindra walked away with an estimated $9.5 million cash and additional trade secrets.

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“Mahindra told the dealers that its light trucks and SUVs were ready for delivery to the U.S. market,” said attorney Michael Diaz in a press release detailing the lawsuit filed in U.S. District Court in Atlanta on behalf of would-be dealers in five states including Florida. “However, Mahindra intentionally delayed certification of its vehicles after obtaining the dealership fees and trade secrets, and began pursuing other partners in the U.S. and elsewhere in clear violation of their commitments.”


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.