Any dealers here impacted by the Mahindra and Global Vehicles lawsuit?

[XDCX]

Anyone here impacted by the lawsuit filed by Global Vehicles and Mahindra?

Mahindra is the OEM from India who planned to import a small diesel pickup and SUV to the U.S. Global Vehicles was going to be the distributor and reported they had 350 dealers lined-up to sell the vehicle. (I'm assuming these dealers paid some type of Franchise Fee to secure their market.)

Apparently the process to get the vehicles certified by the EPA took so long that Mahindra has attempted to terminate their agreement with Global Vehicles. Global filed suit against Mahindra in a U.S. Court but has since withdrawn that lawsuit. A separate arbitration case between Global and Mahindra is ongoing in Britain.

I'd heard Global Vehicles was targeting many of the rejected GM and Chrysler dealers suggesting that Mahindra would be a great replacement franchise. That's why I'm wondering in any of our members (or their dealer colleagues) have been impacted.

I'm just curious where the dealers who made an investment stand in this mess?

[XDCX]

For those who may have a hard time visualizing the Mahindra pickup, here's a picture:

According to a report in Automotive News the EPA has rated the vehicle at 19/21 - that's much worse than the 30 MPG that was initially suggested when dealers were being solicited for open points.

[57years]

I must say, I was so impacted. A 10 yar old building, no franchise, market area covered by every current manufacturer, and here comes Mahindra. I signed for Mahindra long before the obama "takings", I could have rented a gas station and parking lot and been in business. Now Mahindra becomes my franchise in the big building. Mahindra slow rolled this vehicle introduction, and Global could do no more but demand Mahindra fulfill the contract or buy us all out.

By the way, Global Georgia action was not dismissed, in terms of no future lawsuit, but was "stayed" pending the Arbitration proceedings in London. Global can refile in Federal Court in Georgia after the "final decision" of the Arbitrator.

I was first concerned about the mileage rating. I understand, Mahindra controlled how they asked the EPA to determine what vehicle to rate. They could have asked for their standard cab, 2WD; the vehicle they have pandered as the "30 MPG." Mahindra didn't! Was this a strategic error, or more of the same diversionary tactics the Indian Company has a pattern of? Was this all a part of a plan to have another excuse to postphone the U.S. intro until their new world truck (now announced) is ready? Do they really want a "independent distributor" or is the real agenda they have "changed" their mind and now want a wholy owned deal. (Since they signed Global, they have bought out or acquired majority interests their South Africa and Austrailian distributorships.)

In a nutshell, for my investment to be worth a plug nickel, Mahindra needs to do one of three things: 1) Give an absolute confirmation, "Global's Dealers are Mahindra's dealers regardless of the outcome of the Arbitration; or, 2) Global needs to win the Arbitration; Or, 3) Mahindra needs to buy either a majority interest in Global's stock (thus we become Mahindra's dealers) or buy out Global's Assets including all the franchise agreements (thus we become Mahindra's dealers).

Clearly, there is little here we dealers have contol over!
You're right--What a Mess!

[flstsphil]

I purchased a Crosslander franchise several years ago to go in a seperate building I own next to my then single point Chrysler dealership. I have kept the building empty for several years because the franchise has always seemed to be about a year away. When Crosslander did not work out John Perez was able to work out the distributorship with Mahindra. I still have high hopes for this franchise. The company seems to be like an Indian Hyundai. They have been around a long time and are successful in many different businesses.
State franchise laws still seem to apply to the franchise, even if Global Vehicles is no longer the distributor.

[57years]

I couldn't agree more. The purchase of REVA and Ssaangyong look to make the "potential" for a multi-faceted franchise. I would hope Mahindra would not have separate franchise for either the electric or Crossover vehicles. Again, they have said nothing, leaving this all to conjecture.

[XDCX]

Is there much communication between the 350 dealers who have signed a franchise agreement with Global Vehicles? Was a list of dealers ever published?

Additionally, what are most dealers hoping for - a legal victory for Mahindra or Global Vehicles?

If these questions are too sensitive for an open forum, we can always create a new thread in AREA 51.

[57years]

So far, I don't think this is too sensative.

Most all of the dealers were published the GV website. I just tried to log on and the site is "down for construction," another hint!

www.mahindrana.com or http://www.gv-usa.com/.

Global sends an email about once a week. They seem to be on the defensive, in terms of, there is NOTHING from Mahindra, so Global winds up responding to every negative comment in the press, while having nothing new to offer.

Mahindra treats the dealers as "mushrooms". You know, from the the old phrase all the other manufactures have come to use as business philosophy!

I see only a Global Victory being in our interest. Mahindra wins, and Global has no supplier, and the dealers are history!

[birch3x]

I thought of adding them in late 07, as I recall. The idea was for another truck-type franchise to add to the Chrysler lineup. A 30+ mpg small truck looked viable. The idea drifted off when Bankruptcy and Cash for Clunkers showed up. As I recall the initial outlay of cash was to be rather large.

[XDCX]

Originally Posted by 57years

Most all of the dealers were published the GV website. I just tried to log on and the site is "down for construction," another hint!

Here's a website that lists all of the Mahindra Dealers - click here (I love Google.)

Originally Posted by 57years

I see only a Global Victory being in our interest. Mahindra wins, and Global has no supplier, and the dealers are history!

Interesting - thanks for sharing your perspective.

I was going to ask if the NADA had been helpful in supporting the dealers' position but then I remembered they really don't do that anymore.

[57years]

Subtle, but appropriate!

[57years]

Looks like ug 27th is the date for arbitration in England. A significant number of dealers have ponied up cash to help Global, if only because of the silence of Mahindra as to our fate. Clearly, our interest is in the franchise not the distributor. Global offers the only win-win in the deal. Interesting the number of dealers I have talked to who "don't care" about the outcome. I can only guess their investment doesn't mean much. Interesting how some other of the dealers care enough to file grievences in their state Motor Vehicle Commissions. I think there is a little "peck Mahindra to death" theory working here.

[flstsphil]

There is a second legal action taking place in St. Louis. The dealers are all involved in a class action against both Global Vehicles and Mahindra for breach of contract. At this point, these lawyers are working on a contingency basis with no up front money paid by the dealers.

Last I heard, the lawyers for the dealers were having a difficult time properly serving Mahindra with the suit. They said this is common with international companies.

[XDCX]

Originally Posted by 57years

Looks like ug 27th is the date for arbitration in England. A significant number of dealers have ponied up cash to help Global, if only because of the silence of Mahindra as to our fate. Clearly, our interest is in the franchise not the distributor. Global offers the only win-win in the deal. Interesting the number of dealers I have talked to who "don't care" about the outcome. I can only guess their investment doesn't mean much. Interesting how some other of the dealers care enough to file grievences in their state Motor Vehicle Commissions. I think there is a little "peck Mahindra to death" theory working here.

Originally Posted by flstsphil

There is a second legal action taking place in St. Louis. The dealers are all involved in a class action against both Global Vehicles and Mahindra for breach of contract. At this point, these lawyers are working on a contingency basis with no up front money paid by the dealers.

Last I heard, the lawyers for the dealers were having a difficult time properly serving Mahindra with the suit. They said this is common with international companies.

Thanks for the updates - it sounds like it's been a struggle for the dealers who were betting on Mahindra. I still remember when Global was running full-page ads in Automotive News soliciting dealers by suggesting that Mahindra was going to be the next hot franchise - just like Toyota was in the late 60s.

[XDCX]

It seems like it's been a long time since I've heard anything about the Mahindra lawsuits shouldn't something have happened by now?

The last I remember reading their was a lawsuit that was going to be heard in London that could impact U.S. dealers hoping to secure a Mahindra franchise.

Does anyone have an update?

[flstsphil]

Global Vehicles, the United States distributor for Mahindra vehicles shut down their offices. The arbitration is going forward beginning August 30 in London, England. Global Vehicles will not be distributing vehicles in this country. A victory in the arbitration would transfer liability for the dealer contracts directly to Mahindra.