New Delhi: Japanese auto maker Nissan India Motor Pvt. Ltd, which has mostly been exporting cars to overseas markets from its Chennai facility, has shifted the production of its hatchback, Micra, to France.

The freed-up capacity at the Chennai plant, which was set up jointly with Renault India Pvt. Ltd, will be utilized to manufacture Renault’s new products, besides a yet-to-be launched compact utility vehicle from its sister brand Datsun, two people aware of the development said.

In FY17, 70,665 units of Micra were exported, while in the five months to August 2017, only 25,324 units were shipped. “As a Renault-Nissan Alliance global strategy, we have moved the production for the next-generation Micra for Europe to France starting August 2017," said a Nissan spokesperson.

According to the first person cited above, Nissan is also planning to cut down on the export of its sedan, Sunny. In FY18, 34,075 units of Sunny were exported, an increase of 8.43% from 31,425 in 2016-17.

To achieve full capacity, the Chennai plant will now focus on products from the Renault stable. “Nissan has not been able to make a mark in the domestic market. So it makes sense to utilize the capacity for Renault since it has a long product pipeline for India. Some models of Datsun may also be manufactured," he added.

The second person said that with the Japanese influence on Nissan waning, the French are taking the call on the company’s India strategy. “In India, Renault is a much more formidable brand because of the success of Kwid and Duster. Hence this was a logical step."

Nissan did not do well with the Redi-Go, the small hatchback, and also failed in its efforts to grab a slice of the burgeoning compact SUV market with Terrano.

Now, the Renault-Nissan Technical Centre in Chennai is working on two products—a premium hatchback and a compact SUV—which are expected to hit the market in a couple of years. According to the company’s Drive the Future document, Renault plans to expand its India portfolio on the Kwid platform.