Nissan axes pact with Hover, to sell cars on its own in India

Nissan has announced that its Indian subsidiary – Nissan Motor India – has assumed full responsibility for sales, marketing and distribution of all Nissan-branded vehicles and parts in India, with immediate effect. As a result, the carmaker’s agreement with Hover Automotive India to market Nissan-branded vehicles and parts in India has been terminated. The two companies had entered into a partnership in 2008. 

Commenting on the decision, Kenichiro Yomura, Nissan president, India Operations, said: “Nissan is now at a point of maturity in India where the time is right to establish our own marketing and distribution operations. Nissan’s priority will be to ensure a smooth transition from current operations. We remain committed to our customers and will continue to deliver high quality products and services.”

A company source, who Autocar Professional spoke to, says things didn’t go as planned, which is why the partnership has been called off. Interestingly, such a model under which sales and marketing of Nissan cars was outsourced was tried for the first time in Nissan’s global operations, in India.

Nissan’s decision comes a couple of months after Datsun had announced that it would sell its cars directly through Nissan in India, allowing the new brand to take advantage of an already established and expansive retail network. The Go hatchback is slated to go on sale next month.

In January 2014, Nissan Motor India sold a total of 5,183 cars, posting a year-on-year growth of 26.79 percent. In the 10-month April 2013-January 2014 period, it has sold 29,303 units, down 11.02 percent over sales a year ago. 

Several hours after Nissan’s announcement, Richard Spitzer, acting COO of Hover Automotive India, issued a statement saying: “We would like to inform all concerned that negotiations with Nissan are ongoing at this stage and it is premature to say any agreement regarding termination has occurred.”