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Mahindra Rejects $35 Million Purchase Order From Global Vehicles

Posted in auto industry, Car Buying, New Cars, Newsworthy, Trucks by Kurt Ernst | September 30th, 2010 | Leave a Reply |
Mahindra TR20

A Mahindra TR20

The promise of a low cost, diesel powered compact work truck on these shores grows more distant with every passing day. First, it appeared to be Mahindra’s fault, since they just couldn’t seem to gain EPA approval for the diesel powered pickup trucks. By the time they did get a thumbs up from the EPA, their U.S. distributor, Global Vehicles, had filed a $35 million lawsuit alleging that Mahindra deliberately delayed EPA approval to let the distribution contract with Global expire.

Last week, Global Vehicles tried to place a $35 million, “all-is-forgiven-let’s-get-down-to-business” purchase order for TR20 and TR40 pick ups with Mahindra. Mahindra rejected the purchase order and is now accusing Global Vehicles of “engaging in PR theatrics” at the expense of Mahindra’s reputation. Um, OK; do you have a better offer on the table?

Here are the facts: Mahindra has a ready, willing and able distribution partner in Global Vehicles. They have assigned dealerships, they have a distribution network and they even have a U.S. website. Mahindra, on the other hand, has none of these things in the United States without Global Vehicles, and the “do it yourself” route will be a guaranteed financial disaster for the Indian manufacturer. How long do you think it will take to set up a dealer network of your own, particularly if you’re fighting “cease and desist” lawsuits filed by Global Vehicles? The only viable way through this mess is for Mahindra to bury the hatchet with Global Vehicles; until they do so, Mahindra won’t have a chance at establishing itself in the U.S. truck market.

Source: Autoblog

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