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Renault revives India investment plan

Renault revives India investment plan
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First Published: Wed, Jan 06 2010. 12 12 AM IST
Updated: Wed, Jan 06 2010. 12 12 AM IST
New Delhi: Renault SA will resume investments in an Indian factory it’s building with affiliate Nissan Motor Co. Ltd, less than a year after it suspended its plans, as economic stimulus and tax breaks lifted car sales in the country.
Renault will introduce two cars in India next year, Marc Nassif, the local country manager for France’s second-largest automaker, told reporters at the New Delhi Auto Show. Renault has spent $144 million on the plant in Chennai, and with Nissan plans to invest Rs45 billion by 2015, he said.
“We can expect India to be one of the pillar markets for us,” Katsumi Nakamura, Renault’s executive vice president for Asia and Africa, told reporters in New Delhi. Annual vehicle sales in India, Asia’s fourth biggest car market, are likely to surge three-fold to 6 million units in 10 years, Nassif said.
Renault suspended investments in the factory last year after global car demand plummeted amid the worst global recession since World War II. Nationwide vehicle sales in India surged 61% in November, the fastest pace in at least five years, according to the Society of Indian Automobile Manufacturers.
The Chennai plant will have an initial annual capacity of 200,000 cars, Renault Nissan Automotive India Pvt. Ltd said last year.
Renault will also review the future of its venture with Mahindra and Mahindra Ltd in India that makes the Logan car, Nassif said.
The joint venture’s sales plunged 66% between April and November, extending a 48% decline in the year ended March. Mahindra controls 51% of the venture, which started selling the Logan in 2007.
Mahindra is in discussions with Renault regarding its joint venture, Anand Mahindra, managing director of the Mumbai-based company, said in Singapore in November.
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First Published: Wed, Jan 06 2010. 12 12 AM IST
More Topics: Renault | Mahindra | Car | Auto | India |