FADA requests government to monitor Ford India's compensation plan for dealers

After around a week of asking Ford India to provide clarity on how it plans to compensate its dealer network in the country, Federation of Automobile Dealers Association (FADA) has now urged the government to monitor the auto maker's compensation structure being worked out. The dealers' body's President Vinkesh Gulati has requested the Heavy Industries Ministry to form a task force to monitor the updates from the company.

In a letter to Heavy Industries minister Mahendra Nath Pandey, Gulati also requested the ministry to instruct the auto company to keep FADA in the loop regarding the compensation structure updates. "We humbly request your Ministry's intervention... Create a task force which takes day-to-day updates from Ford India to monitor the compensation plan for automobile dealers and dealership employees," the letter read.

Besides these points, the letter mentioned that Ford India is “forcing its dealers to first sign Non-Disclosure Agreement (NDA)… before any compensation package is worked out". Many dealers have brought it to the notice of FADA, requesting the body to take up the matter to find an amicable resolution. Gulati condemned the the automaker's approach and said that it adversely impacts the dealers, who are already under economic duress.

Gulati requested the ministry to make sure that the auto maker also compensates dealers from various consumer and civil cases, both under pendency and against any future cases that may arise directly or indirectly out of the automaker's restructuring announcement.

The letter reiterated FADA's request for the Centre to pass the Franchisee Protection Act as soon as possible, which will provide a cushion to dealers in case any OEM decides to shut shop and ship out of India. “This will not only safeguard the dealers' and customers' interests in India but would also protect the interests of people employed by the dealerships," the letter elaborated.

(with inputs from PTI)