Nissan Motor India and Hover Automotive India are involved in a spat over termination of contract between the two companies. As is known, Nissan had entered into a pact with Hover in 2008 for the sales, marketing and distribution of Nissan branded vehicles in India.
On Friday, February 17, 2014, Nissan had issued a statement saying that it has terminated its pact with Hover and is assuming all responsibility for the sales, marketing and distribution of Nissan branded vehicles in India. The company did not cite any reasons for termination of the contract.
Meanwhile, in reaction to Nissan’s statement, Hover Automotive India (HAI) issued an official statement on February 14, 2014, wherein the company’s Acting COO, Richard Spitzer has stated: “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.” He goes on to state that the company is hopeful of an amicable resolution and “until then, HAI expects to continue to be the sole and exclusive distributor for the Nissan brand of vehicles in India”.
The statement added, “We would like to reiterate that Nissan does not have any legal basis for the termination of services of its national sales company - Hover Automotive in India. The management at HAI has taken strong exception to the announcement this morning (February 14, 2014) by Nissan. HAI reserves all rights and remedies available and will pursue the necessary course of action to protect interest of its employees and stakeholders.”