Rocky JV between Nissan and Ashok Leyland to Come to an End
Published On Feb 17, 2016
A week after Ashok Leyland had taken Nissan to court over a legal dispute between the two joint venture entities, Nissan has served a termination notice to its Chennai based partner. “We are working with Ashok Leyland for a mutually agreeable solution. We have no further comments on the subject,” said a spokesperson from Nissan. Meanwhile, officials at Ashok Leyland refused to comment, merely stating that the matter was 'sub-justice'. Last week, during the legal clash between the two entities, an official from Nissan had remarked, “We have received the notice from Ashok Leyland and we are contesting it.”
The partnership between the two leading brands commenced in 2008, and was aimed at tapping into three areas – the LCV segment, power-train manufacturing and technology. The two brands worked together to release light commercial vehicles such as the Ashok Leyland Stile and the Nissan Evalia. Unfortunately, their models glimpsed little success in the market, and were eventually marginalised. “The Stile and Evalia platform were a mistake,” admitted Vinod Dasari, the Managing Director of Ashok Leyland in an earlier interview. “Like any joint venture, we have issues with our joint venture partners. Sometimes good and sometimes bad,” added Dasari.
According to a document filed with the Board for Industrial and Financial Reconstruction (BIFR) last November, the net worth of the joint venture has been overrun by the accumulated losses, which came to a hefty Rs. 172.37 crore. Ashok Leyland had been forced to dispose of nearly Rs. 214 crore from the failed venture, having accrued a loss of Rs. 791 crore in the last fiscal.