New Delhi: French car maker Renault’s Indian unit expects to sell 100,000 vehicles by the end of 2013, a top executive said on Monday, after it launched its first independent model in the world’s second-fastest growing auto market.
The company, which exited a joint venture with Mahindra and Mahindra last year, launched its Fluence sedan—costing as much as Rs 1.44 million ($32,036)—in India.
“With five products available for sale by end-2012, we aim to sell 100,000 units in 2013,” deputy managing director Sudhir Rao said.
The automaker said it aimed to export €100 million worth of components in 2012 compared with €35 million worth of exports in 2010.
India is being increasingly seen as a production hub for global automakers as rising cost pressures in their home markets drive them to source from countries that offer cheaper labor and parts.
Renault will double capacity at its plant in the southern Indian state of Tamil Nadu to 400,000 by end-2012 and has committed an investment of Rs 4500 crore for the plant which will roll out five models beginning with Fluence.
The Renault-Mahindra joint venture was formed in 2005 to make the Logan sedan in India.
The Logan was initially greeted with enthusiasm but saw disappointing sales thereafter, in part due to its length of more than 4 metres, which attracted a higher factory-gate duty, making it expensive for its target segment.
“Logan has given us a good learning about the Indian market. We (now) know what the customer wants, the market wants,” Renault India managing director Marc Nassif told reporters.
Rising incomes in Asia’s third-largest economy is lifting demand for entry-level sedans in the market, which had previously focused on small-sized cars.
Earlier this month, Hyundai Motor introduced a new version of the Verna subcompact sedan in India, targeting to sell 45,000 units this year.