Bajaj Auto is on course with the development of the ultra low-cost (ULC) car whose prototypes will be shown to its partner, Renault, during the course of this calendar.

“We are dead serious about the car project. Some time later this year, in fact in a matter of months, we will be able to show Renault the prototypes,” Mr Rajiv Bajaj, Managing Director of Bajaj Auto, told Business Line.

This is keeping in line with the revised arrangement announced by Mr Carlos Ghosn, CEO of Renault-Nissan, during his visit to India in November 2009. Bajaj was then entrusted with the task of designing and manufacturing the ULC car while Renault would market it.

“As is well known, till November 2009, things were going in one direction which to me was not the recipe for success. I explained to Mr Ghosn what my apprehensions were and I was fortunate that he understood my point of view and implemented the new plan. The project has undergone a significant change since then,” Mr Bajaj said.

The company has now been developing the car in line with its thinking of what is appropriate for the Indian market even while the market is abuzz that Renault has no clue about what is going on. In fact, this has led the sceptics to conclude that the project will never see the light of day.

“We are not hiding anything from Renault and are going exactly by what was discussed between Mr Ghosn and me. I told him that if he wanted frugal engineering, it was best that my people do the project to which he immediately agreed,” Mr Bajaj said.

It is now up to Renault to decide if it wants to be associated with the ULC car after checking out what Bajaj Auto has developed. The vehicle has already been touted as the challenger to the Tata Nano and will kick off with a price tag of around Rs 1.5 lakh. Having been developed ‘with the motorcycle mindset', it is expected to deliver mileage of 30 km to a litre.

“When Renault sees the car, it is for them to decide if the product goes with their brand or not. From my point of view, it will be great if they accept it. They would only reject it if they felt the product was not resonating with their brand. I would never for a moment associate this with any mala fide intentions on Renault's part,” Mr Bajaj said.

‘Win, Win' situation

Even if this were to happen, it would be of little consequence since the same platform can spin out a Bajaj Auto four-wheeler which the company can sell on its own. Three-wheelers can also be produced here. All the work done on this project would, therefore, be valid and productive without anything being lost.

“If Renault walks away, we can still sell our own four-wheeler. We would never develop something for someone else, who has a right to walk away, and we are left holding the baby. How can we possibly justify three years of development and have nothing to show for it? That would be the heights of irresponsibility to our shareholders,” Mr Bajaj said.

(This article was published on March 21, 2011)
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