Mahindras road to the United States has been interesting so far, to say the least. It's changed the trucks model name, seen delays in a target launch date, caused delays and broken contracts.
Many here in the states are eagerly awaiting the arrival of an official on-sale date for the Pik-up. The biggest group waiting for that announcement might just be Global Vehicles, the U.S. distributor for the little truck with potential big appeal. Global Vehicles has already invested nearly $100 million to bring the vehicle to the US and now they've placed an initial order for the Mahindra pickups to the tune of $35 million.
John Perez, CEO of Global Vehicles, says:
Perez goes on to state that he believes Global Vehicles will prevail in the pending arbitration case against Mahindra. This would force Mahindra to honor its agreement with GV. The offending clause states that Mahindra could walk away from the deal if its truck did not pass EPA testing by a certain date. Mahindra claimed this last-minute contract change was to protect against potential losses if its truck didn't receive the EPA certification. The deadline dates came up three times, with Perez's company extending the deadline each time. The most recent time passed on June 11. Ten days after that deadline, Mahindra announced its vehicles were certified for sale and declared its relationship with GV now void."We are proud of the sales and service network we created to support the launch of Mahindra vehicles, and we look forward to bringing American buyers something truly unique in the marketplace – rugged, high-quality, clean diesel pickup trucks that can achieve nearly 30 miles per gallon. Our dealers are all seasoned auto industry professionals who will treat customers with honesty, integrity and respect. We built our business on these bedrock principles, which should be the foundation of every business relationship."
It will be very interesting to watch this play out. The Pik-Up is supposed to be an affordable and capable, fuel-efficient truck which could be a perfect fit for many U.S. buyers. It's clear that Global Vehicles remains extremely committed to its investment and hopefully we see the distinctly-styled trucklet roaming our streets in the near future.
Full press release available after the jump.
- Nearly $100 million investment by importer Global Vehicles U.S.A., Inc. and close to 350 Mahindra dealers rides on a successful launch
- Global Vehicles expects sales could reach $1.4 billion annually in four years
- Initial orders will be delivered to dealers in the Southeast, followed by other regions over the next eight months
- First-year sales volume could reach 30,000 units
A $35 million-plus factory order will be placed today for U.S.-spec Mahindra TR20 and TR40 pickup trucks to begin the launch of the brand in the United States, exclusive Mahindra importer Global Vehicles U.S.A., Inc. announced.
Together, Global Vehicles and the nearly 350 Mahindra dealers it recruited in 49 states have invested almost $100 million to bring the rugged, affordable and fuel-efficient trucks to the United States.
Mahindra said in an August press release that it had EPA certification to sell the trucks, and they announced plans to begin selling vehicles in December.
"We are proud of the sales and service network we created to support the launch of Mahindra vehicles, and we look forward to bringing American buyers something truly unique in the marketplace – rugged, high-quality, clean diesel pickup trucks that can achieve nearly 30 miles per gallon," said John Perez, CEO of Global Vehicles. "Our dealers are all seasoned auto industry professionals who will treat customers with honesty, integrity and respect. We built our business on these bedrock principles, which should be the foundation of every business relationship."
Perez expressed confidence that Global Vehicles will prevail in pending arbitration hearings and court proceedings that the company initiated to force Mahindra to honor the terms of Global Vehicle's distribution contract, which Mahindra inaccurately claims is no longer in force.
Global Vehicles believes that Mahindra purposely delayed the EPA certification process so it could invoke a contract clause that would allow it to walk away if the truck could not be certified for sale in the United States. Global Vehicles extended the deadline for certification three times, with the latest deadline set at June 11, 2010.
Mahindra submitted its certification paperwork to the EPA about 10 days after the June 11 deadline, and announced in an Aug. 20 press release that its vehicles were certified for sale. At the same time, Mahindra posted a two sentence statement on its website stating that its relationship with Global Vehicles had ended.
Mahindra demanded the clause at the eleventh hour before the contract was signed in 2006 because it expressly wanted to limit its losses if the trucks could not be certified for sale here. Earlier this year, well before the June deadline, Global Vehicles asked Mahindra to remove the clause because it was no longer applicable and they refused. Global Vehicles later asked Mahindra for another extension but was again refused.
"We trusted Mahindra when they said they wanted to cap their losses if the vehicle couldn't be sold here," said Perez. "We patiently waited and accommodated Mahindra through years of delays and kept an extremely powerful distribution network intact while the factory worked through the complicated task of meeting U.S. emissions standards. We did this because we believed we were all working toward the same goals. Now Mahindra is trying to change the rules. We delivered our end of the contract, and we're ready to get down to business."