French carmaker may target over 1 lakh units from Chennai plant

India is now the 10th biggest market for French carmaker, Renault, ahead of the targeted date in end-2013.

Sources told Business Line that the heady market response to the recently launched Duster SUV has played an important part in catapulting Renault India to this ranking. The crisis in Europe, which has seen a significant shrinkage in key markets, has also helped the cause.

It is, therefore, “very likely” that India could even climb by another two positions during the course of 2013. At present, it is just behind Spain which has clearly seen better days.

The momentum generated by the Duster could result in Renault targeting production of over one lakh units from its Chennai plant next year. This will also include other models such as the Pulse compact and Scala sedan.

Revival agenda

In its third quarter results declared a couple of months ago, the company had outlined France, Brazil, Russia and Germany as its top four markets followed by Argentina, Algeria, Iran, Turkey, Spain and Italy. With growth focused on emerging markets like India coupled with the ongoing mess in Europe, sources say it is only a matter of time before these rankings see a dramatic change.

The first time Renault unveiled its ‘Drive the Change’ plan in early 2011, the world was a different place with Europe, in particular, nowhere close to the abyss it has sunk into. At that point, India was targeted to be the 11th largest market by next year. The top management had reiterated that along with Brazil and Russia, it would be one of the big growth engines of the future.

Soon after its break-up with Mahindra & Mahindra in the Logan joint venture, Renault has been focusing on a ‘step-by-step’ approach to its India revival agenda. It launched the Fluence and Koleos SUV quickly followed by the Pulse and Scala. However, it was the Duster that whipped up the big numbers and has been growing from strength to strength since then.

Team Renault India

The fact that SUVs have been registering good growth in an otherwise somnambulistic car market has clearly helped the Duster’s cause. Yet, there was tremendous hard work put in by the Renault India team to get everything right -- from the features and mileage to the final price. The Duster has also begun its global journey from India to the UK with other RHD (right-hand drive) markets likely to follow in due course.

Renault is betting big on its next project, the global compact car which will retain the French company’s ‘premium DNA’ and be priced upwards of Rs 4 lakh. It will be part of the B-plus segment which is seeing brisk growth led by models such as the Suzuki Swift, Ford Figo and Toyota Etios.

(This article was published on December 22, 2012)
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