Team code: NM- 42

Dr. Ram Manohar Lohiya National Law

University, Lucknow

Negotiation Competition (Prelims)

Negotiation Plan in the matter between

AdvaniWheels Ltd.

&

TATO Motors Ltd.

-On Behalf of AdvaniWheels Ltd.-

 STRONG POINTS
1. Advani’s Credentials: AdvaniWheels is a fast-growing industry, last estimated to be worth
$380million(over 8x of TATO’s worth), and it is a known fact that other clients of TATO
Ltd. are happy to buy TATO Ltd. vehicles & parts even though they are expensive because
of their business relations with AdvaniWheels.
2. TATO’s Consumer Base: Market value of TATO is around $40- 60million and Advani has
already done business of around $40 Million with TATO Ltd. over the period of four years.
This means every year Advani invests an average of $10 Million/25% of TATO’s market
value. This makes Advani a big client of TATO and a strong player in this negotiation.
3. Supply Agreement Clause: According to Clause 10.1 of the Supply Agreement, "TATO
Ltd. shall use all reasonable endeavors to repair/replace the products within 10 working
days”. This clause holds TATO accountable for the repairs of all the affected cars within
the agreed timeline.
4. Mismanagement of TATO: TATO has been accused of poor management, with little
progression by the company since it signed the supply agreement with AdvaniWheels;
Making Advani a strong player in this negotiation.
5. TATO’s Future Prospects Vulnerable: As backed by recent industrial reports, the long-
term prospects of its CarbonFree™ technology are vulnerable, due to the potential increase
in the use of electric cars for environmental concerns; as a result, TATO Ltd. is not in a
position to lose one of its main clients.
1. Environment Benefits & Praise: The fame, recognition & tax deductions that
WEAK POINTS
AdvaniWheels is receiving are technically because of TATO’s green technology. If TATO
Ltd. backs down from this deal, AdvaniWheels will ultimately fail to get a chance to
become the official sponsor of the MotoGP race.
2. TATO’s Car Share in AdvaniWheels: TATO’s share in AdvaniWheels in total is around
75% of its eco-friendly cars and half of Noida’s fleet is faulty which puts AdvaniWheels on
the weaker side as the support from TATO is a real urgency for them at this stage.
3. Obligatory to use TATO’s Services: According to the recent contractual agreement
between the parties, AdvaniWheels is obligated to purchase all their "Advani" vehicles
from TATO, and can only use TATO for repairs on cars purchased from TATO. This gives
an edge to TATO as AdvaniWheels cannot approach any other company for repair
services.
4. No Indemnity/Warranties Clause: AdvaniWheels did not pitch for any warranties or
indemnity clause about the performance of the converters and now because of the same,
TATO can charge its usual repair cost that is $8,000 per converter to AdvaniWheels.
5. End of Exclusivity Clause: The current exclusivity clause between the companies was
signed three years ago for a term of four years, which means after a year TATO will be
able to sell its carbon-free technology to anybody.
1. Assist TATO Ltd. in Repairing Vehicles: AdvaniWheels Ltd. will employ its repair team
BEST ALTERNATIVE TO NEGOTIATED AGREEMENT
and resources to repair 25% of the defective cars while the rest 75% of the defective cars
will

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 be repaired by TATO Ltd. as per the contract clause without charging any amount for the
repair work from AdvaniWheels.
2. Acquiring 51% in TATO Ltd.: TATO is facing poor management issues, customers are
not happy with its services, and even clients get in business with TATO only due to the
Advani credentials. So if Advani acquires 51% stake in TATO, it will ensure that problems
like these don’t arise in the future and will also lead to company’s smooth functioning.
3. Reasonable Endeavors under Section 10.1: Section 10.1 of the agreement requires
TATO Ltd. to take all reasonable means and endeavors to repair any product(s) within ten
(10) working days. As a reasonable option, TATO Ltd. can employ supplementary
independent workers for Advani’s cars to solve the issue and repair all the vehicles within
time, in return Advani will provide 10% of the revenue earned during MotoGP race to
TATO as a bonus.
4. Acquiring CarbonFree Technology: AdvaniWheels is willing to purchase the patent of
CarbonFreeTM technology catalytic converters from TATO Ltd. In return, TATO will get
out of all the contractual obligations which include car repair work. Also, considering the
vulnerable prospects of their technology, this will give financial stability to TATO Ltd. as
well. The finances received by TATO can be used for the company’s further development.
1. Repairing of all the Affected Cars: AdvaniWheels is in the necessity to return to normal
NEEDS & INTERESTS.
service by December 2022, for securing the lucrative sponsorship position at Moto GP as
well as continuing its day-to-day operations over the longer term.
2. Continued Supply of Carbonfree Technology: AdvaniWheels needs to get a continued
supply of Carbonfree Technology cars from TATO because of the fame, recognition & tax
deductions, extending the exclusivity clause which can only be done by TATO is also
Advani’s interest.
3. To be the official sponsor of Moto GP Race: Foremost need of AdvaniWheels is to look
forward to the MotoGP Race as a prime opportunity to gain recognition for a superior taxi
service & to be their official sponsor for increasing their revenue and prospects.
1. Reach Consensus for a Fair Deal: AdvaniWheels wishes to reach an agreement through
OBJECTIVES & GOALS.
negotiation to protect its economic and administrative interests and increase its goodwill,
business prospects and reach in the market while negotiating a fair-trade deal for both
companies in the mutual interest of all the stakeholders involved.
2. Acquire Stake in the Holdings of TATO Ltd.: To ensure future synergy between both the
companies and to avoid any such present situation, AdvaniWheels aims to acquire a
considerable stake in the holdings of TATO Ltd.
3. Extension of Exclusive Agreement- AdvaniWheels requires that its exclusive agreement
with TATO Ltd. should be extended due to which it can remain more environment friendly
than its competitors and continue to have its monopoly.
4. Allow Repairs from Other Companies: TATO Ltd. has a very small repair team and is
unable to deliver adequate service, causing AdvaniWheels significant loss and
inconvenience. As a result, the condition stating that repairs should only be performed by
TATO Ltd. should be removed.

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