EXCLUSIVE: Mahindra’s US Dealers Form ‘Action Committee’

There’s still time for the inauguration of the first dealership of M&M automotive business in the US, but the management has already received invitation from the dealers appointed by its distributor Global Vehicles,Though, for a different reason.

M&M’s dealers in the US have formed ‘The Mahindra Dealer Action Committee’ which has written an ‘open letter’ (a copy of which is in possession of Autocar Professional) to Anand Mahindra asking him ‘to put the legal struggle with Global vehicles and the dealers behind’ and ‘to immediately plan a successful product launch in the United States’.

The dealer body has invited Mahindra, or Dr. Goenka as his representative, to a meeting arranged in Atlanta, Georgia today. In its letter, the dealer body also assures M&M of its ‘strong commitment’ to ‘invest the necessary to insure Mahindra’s success’ in US.

When contacted, an M&M spokesperson said the company will not attend the meeting as the matter (legal tussle with Global Vehicles) ‘is in arbitration’.

Before Global Vehicles filed a lawsuit against M&M in June last year, it had appointed 347 dealers to sell Mahindra range of vehicles. There have been delays due to various reasons like regulatory clearance, product readiness. And that has created a concern among M&M’s business representatives. In its lawsuit Global Vehicles had also asked the court to prevent M&M from appointing another distributor. The recent Ssangyong acquisition by M&M has also ‘heightened’ the dealers’ concern of the reported plan of importing M&M vehicles through Ssangyong’s channel into the US.

The dealer action committee also states in its letter that it is prepared to start operations as investments have been committed ‘in terms of franchisee fees, brand signage, floor plans, facility construction/restoration and equipment purchases. Global Vehicles had earlier stated that close to 35 million USD had already been invested in preparing for the launch of M&M’s pick-up truck. In the latest letter, Mahindra’s US dealers indicated that it is not interested in resorting to any further legal actions but is interested in going forward with M&M ‘in the manner that Dr. Goenka and the executive team committed’ in the April 2007 dealer meeting.