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Mitsubishi finally ends distribution contract with its distributor Masria in Egypt

20.07.2010 / Cairo - Dubai -Tokyo /

In a dramatic but expected way, Mitsubishi Motors Corporation (MMC) in Japan finally announced today that it ended its contract with its non-exclusive distributor Masria in Cairo.

Although not recognizable at first sight, the few sentences of this announcement do include a lot of serious indications and surprises.

The first indicator is the first sentence of the official announcement, which states that Mitsubishi Motors Corporation 'honors its commitment to its customers in Egypt by ending the distribution contract between MMC and Masria'. In other less-diplomatic words: Mitsubishi Motors Corporation is ending its contracts with Masria due to the lousy service and reputation of Masria in Egypt.

Another even more serious indicator is the fact that Mitsubishi Motors Corporation states in its announcement that Masria had a 'non-exclusive' distributor contract only.

This means that Masria had been cheating on its thousands of customers over the past few years and that most of its full-size and half-size advertisements in Egypt's largest newspaper were seriously misleading and not correct, including the very obvious fake letters from Mitsubishi Motors Corporation MMC which were published in the ads about the Gulf-specs Mitsubishi cars imported from the Gulf region.

I think that this 'customer-service' should have a serious after-play and investigation not only from Mitsubishi Motors Corporation but also from the Consumer Protection Agency in Egypt.

I also hope that Mitsubishi Motors Corporation will not do the same mistake with its new importer. Before deciding on one distributor they should scan and evaluate the potential candidates throughly and preferably choose one candidate who does not represent another or competing car brand. Getting reliable and unbiased opinions about the existing car dealers and potential candidates from independent sources and local automotive experts is utterly important in order to have a smooth restart in the Egyptian car market.

Best solution for Mitsubishi Motors Corporation would be to establish a regional Mitsubishi Motors Corporation Representative Office in Cairo, and have at least five distributors for Cairo alone, as this city and country is simply to big for just one distributor or importer, who would become again as over-strained as Masria was.

Mitsubishi is one of many other companies including Rolls Royce, Volvo, VW Nutzfahrzeuge and many more who decided to end their contract with their local importer or distributor in Egypt recently.


And that is what the official Mitsubishi Motors Corporation statement had to say:

Mitsubishi Motors Corporation honors its commitment to its customers in Egypt!

End of the distribution contract between Mitsubishi and Masria!

Cairo 20 July 2010,

Mitsubishi Motors Corporation (“MMC�) announced the end of its contract with Masria Co. (“Masria�), concerning the distribution of its vehicles and spare parts in the Egyptian market, as of 20st July 2010.

"The non-exclusive distribution contract signed between MMC and Masria expires according to its terms on 20 July 2010; from a legal point of view, MMC is fully entitled not to renew this contract and does not need to offer any legal justification for doing so.� Said John Matouk, Managing Partner of DLA Matouk Bassiouny, the law firm representing MMC in Egypt.

John Matouk added that “MMC’s business decision not to renew with Masria and to appoint a new non-exclusive distributor is based on MMC’s strategy of further developing the Egyptian market for the benefit of MMC and its customers. "

“At this stage, we are stepping up efforts to choose the best and the most eligible of the new candidates applying to be MMC’s major distributors in the Egyptian market. Negotiations are currently underway; taking into account that the choice has been narrowed to only two candidates. They will assess according to their potential in applying the company’s ambitious future strategy in the Egyptian market�.

“Current and potential customer interests takes first priority in MMC’s future schemes�, said Osman Mowafi, Head of the Litigation Department at the DLA.

He stressed that the newly-chosen non-exclusive distributor will be appointed to distribute MMC vehicles in Egypt, as well as provide spare parts and after-sale services to all of MMCs customers, who are MMC’s top priority.

The signing of the new distributor’s contract is planned to be announced upon the appointment of the new non-exclusive distributor.

End of statement.

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Readers Comments:

Fadl Abdel Hamid from Cairo - Egypt wrote:
My advise for Mitsubishi:
I am working in the field of Automobile in Egypt since 14 years, and my advise for Mitsubishi is to appoint new distributor who already has a wide experience and history in this sector and who already has enough infrastructure for sales and after sales.
The best choice is to appoint one capable distributor for limited period as a test for both market and distributor and should use the efficiency reports for evaluating the distributor until the end of the first stage. I believe by this way, Mitsubishi will re-brand its brand name in the market again and will lead the segment shortly.
I wish all the best for this BRAND

Fadl Abdel Hamid

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