UM-Motorcycle discontinuation episode is turning ugly. With no response coming from the joint venture partners, FADA has requested government’s intervention…
Now, UM Motorcycles is one example that has definitely eroded confidence in new comers. It ventured in India in 2016 with a lot of hype, continued building the brand through various futuristic showcases but abruptly closed shutters when the going went tough!
We all know the UM episode and partner Lohia group has cleared that it is UM Motorcycles which is not responding and because of various legal agreements, it can not run the show single-handedly (more details). As a result of the sudden discontinuation everyone – right from the owners to the dealers, are suffering major losses.
FADA which is the Automobile Dealer’s representative body had issued a legal notice to UM-Lohia group asking them for all the steps to ensure maintenance and service of all the motorcycles that have been sold in the market and to compensate all the losses of its dealers.
However, in a latest press release shot by FADA, it has been revealed that it has not received a proper response from UM-Lohia JV. Hence, FADA has requested Prime Minister’s Office and Allied Ministries to intervene in this matter. FADA highlights that this is the third case after General Motor and Man Trucks which suddenly exited from our market.
It says that the government will have to frame Franchisee Protection Act in India since we are aspiring to make our country a manufacturing hub with our ‘Make in India’ initiative.
It claims UM’s exit has caused capital losses to the tune of 150 crores, direct job losses to over 2500 people and the 10,000+ customers are now left with machines which will have no spare parts and service back-up.
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FADA clears that it wants the issue to get resolved ‘amicably’, however, if there continues to be no response from UML, then it has threatened to file civil and criminal cases against the company!