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Hyundai India Shuts Down Four Dealerships Down South
South Korean manufacturer Hyundai recently won the 'Car Sabha Elections 2014' in Bangalore. Hyundai India has over 24 dealerships across Coimbatore, Madurai, Salem and Vellore in Tamil Nadu. However, they will be shutting down four of its dealerships down south.
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Hyundai India is an international brand and adheres to global standards. The South Korean manufacturer has provided reason that the dealerships offered poor service quality. This is important to a brand as dealerships could easily affect their brand image if they do not follow a particular standard.
The dealerships in question are the Suryabala Hyundai in Coimbatore, SKBR Hyundai in Madurai, Ramani Hyundai in Salem and Susee Hyundai in Vellore. There have been issues of service quality by these dealers for the past six to nine months.
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It is a common practice among automobile manufacturers to eliminate contracts with non-performing or slow moving dealerships. It takes approximately INR five crore to set up a dealership, which does not include land or property prices. They have to employ roughly 50 to 100 workers either directly or indirectly.
Hyundai India explains, that every year they increase its dealer network in India by 20 to 30 . They have roughly 393 dealers and most of them are happily associated with Hyundai. Over the past two years the South Korean manufacturer has added over 50 dealerships in India.
The dealerships are unhappy about the shutting down of their association with Hyundai. They however, would like more clarity over the issue. The cancellation of a contract with a dealership can be done after due diligence.
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