Ashok Leyland Drags Joint Venture Partner, Nissan, to Court
Published On Feb 12, 2016
Ashok Leyland, Hinduja Group's flagship company has dragged its joint venture partner Nissan to the Kanchipuram District Court seeking a way to halt Nissan's usage of its automotive manufacturing equipment installed at its Oragadam factory in Chennai.
Nissan spokesperson confirmed that the petition was filed. He said "We have received the notice from Ashok Leyland and we are contesting it." However, Ashok Leyland officials were unavailable to comment.
The Joint Venture of Ashok Leyland and Nissan produces engines for the JV product Dost in Chennai at Renault Nissan Automotive India private limited. Under the JV the company has released the Ashok Leyland Stile and Nissan Evalia, which failed to produce a market while Dost has counted over one-lakh sales, according to Ashok Leyland's annual report.
This joint venture is handled as 3 different companies, which manages vehicle manufacturing, technology development and engine manufacturing. Ashok Leyland holds 51% stake in the JV and Nissan with 49%.
This joint venture has recorded an overall loss of INR 791 crore in the last fiscal. This loss making JV has forced Ashok Leyland to pull off INR 214 crores as damages. This Indian firm has also withdrawn INR 157 crores as another impairment in the JV with John Deere in September last quarter.