Ford Motor exit in India opens dealers to customer lawsuits
Ford Motor Co. dealers in India face potential lawsuits from customers after the US auto giant decided to shut down factories in the country.
Dealers are likely to face “legal complications” as Indian consumer law makes them liable after a manufacturer leaves, said Vinkesh Gulati, president of the Federation of Automobile Dealers Associations, in an interview with Bloomberg TV.
“We expect Ford to compensate dealers and plan something for the future so that dealers are not in a legal stranglehold against customers in consumer court cases for their service responsibility,” Gulati said.
The dealers have invested around 20 billion rupees ($ 272 million) in building Ford dealerships in India, which employ around 40,000 people, he said.
Separately, Gulati said the auto industry is losing 20-30% of its potential sales every month because the global semiconductor shortage has resulted in long wait times for cars.
The Thar SUV from Mahindra & Mahindra Ltd. has a 12 month wait period, while there is a six month wait for Hyundai Motor India Ltd.’s Creta SUV.
“I hope that the customers will stay with us and that when the semiconductor shortage is gone, they will actually buy the vehicle, and we will not lose this vehicle to the used car market,” Gulati said.
(With the help of Anand Menon.)