Just as John Perez was about to celebrate finally getting EPA approval to sell Mahindra & Mahindra’s clean-burning diesel pickups in America, he discovered this month that his Indian manufacturing partner had issued a statement -- buried quietly among other press releases on its corporate Web site -- saying it had terminated Perez as its U.S. distributor.
Uhhh … I don’t think things work like that.
Not around these parts, anyway. Not when there is this little thing called a “contract” involved.
I’ve met some of the senior executives at Mahindra. They are wonderfully engaged, enthusiastic car guys. They are precise and articulate about what they’re doing. Pawan Goenka, head of global automotive operations, earned his stripes at General Motors in Detroit. And now they’ve created a minor sensation in the pickup world by getting a grunting little compact four-cylinder diesel truck through EPA in an era of emissions phobia.
There is obviously a partnership squabble going on. But guys -- come on. A one-sentence press release to say you’ve terminated your U.S. distribution company?
John Perez, the man you signed on as your independent distributor four years ago, has invested millions in laying the groundwork. And he has more than 300 dealers impatiently tapping their feet waiting to begin selling Mahindra pickups.
And you imagine you can unilaterally terminate them all?
Americans file lawsuits as a form of calisthenics. And a brief glance at the history of vehicle distribution in the United States might inform you that the courts tend to lean toward the little guys -- dealers and independent wholesalers, not deep-pocketed manufacturers -- in legal contests like this will almost surely be.