Home » Industry » Nissan Loses Local Franchise

Nissan Zimbabwe lost its local Nissan franchise on June 30th, 2014 as Nissan Motor Corporation decided not to renew the distribution agreement following the acquisition of the local dealership by a competing company. This corrects earlier reports that the decision to engage five other dealers was based on poor performance by Nissan Zimbabwe. Nissan Zimbabwe is owned by CFAO Automotive which was in turn acquired by the Toyota Tsusho Corporation. In a letter to Nissan Zimbabwe, Nissan Motor Corporation said the contract would not be renewed because of the acquisition of CFAO by Toyota Tsusho Corporation.

“Due to the acquisition of 97.91% of Nissan Zimbabwe’s parent company, CFAO SA, by Toyota Tsusho Corporation, a group company of Nissan’s competitor, Toyota Motor Corporation, Nissan has decided not to renew the Distribution Agreement,” read the letter.

This move by Nissan Motor Corporation has affected CFAO operations across the continent. In Zimbabwe, Nissan South Africa has partnered five local Nissan dealers in a direct to dealer arrangement that will replace the previous arrangement with CFAO Automotive. Nissan felt that they would now be controlled by one of their major competitors.

In an interview with The Herald Business, CFAO Automotive country representative Mr Marius Prinsloo said his company treats each brand they distribute as a separate business unit.

“CFAO represents 12 brands across Africa. Every brand operates as an individual business unit. We do not mix the brands up. We do not play one brand off against another brand,” he said.

Nissan has experienced significant growth in the Zimbabwean market commanding about 22 percent of the local market, under CFAO’s management.

Mr Prinsloo added that prior to the contract not being renewed the Nissan brand was performing well in Zimbabwe and there were no performance issues between CFAO and Nissan.

Source : The Herald