Renault and Nissan have announced their new growth plans for the Indian market with an infusion of ₹5,300-crore investment over five years that will see the Indian operations of the alliance develop, manufacture and sell at least six new models, including two electric vehicles, both in domestic and export markets.

The alliance of the French and Japanese companies on Monday signed a memorandum of understanding (MoU) with the Tamil Nadu government in the presence of State Chief Minister, MK Stalin.

Making for world

The biggest transformation in their Indian operations will be making localised models for global markets from now as against localising global models earlier, said Ashwani Gupta, Representative Executive Officer and Chief Operating Officer, Nissan Motor Co Ltd.

The six new models — three for each company — will be built on common alliance platforms while retaining the individual, distinctive properties of the respective brands. There will be four new C-segment SUVs and new A-segment electric vehicles, which will be the first EVs for both Renault and Nissan in India. The first vehicle is expected to be rolled out in 2025.

After fixing the business operations in core markets like the US, China, Japan and Europe, Nissan had been exploring growth potential in markets where the brand has the asset, experience and market for future growth potential. “Being the fastest growing market, India fits into the strategy. Also, the success of ‘Magnite’ indicates the evolving customers in India. So, all these factors have pushed Renault-Nissan to take this decision, Gupta told businessline.

“Nissan’s strength is in SUVs. More than 70 per cent of Nissan’s global sales come from SUVs. In India, too, the SUV market is growing faster than cars. Going forward, Nissan’s intent would be double the market coverage with the proposed SUV launches across — A, B and C segments,” he said.

With new product rollout plans, the alliance expects the capacity utilisation of the Oragadam factory near Chennai, which will be modernised as part of the current investment programme to produce electric vehicles, to reach 80 per cent in the future by selling both in India and exporting vehicles, from about 47 per cent now.

Learning from mistakes

With its new experiments — building the first alliance plant, setting up the first alliance R&D unit and roping in a partner for dealer operations — Nissan had fumbled quite badly in the Indian market. On the product side too, it failed in creating and selling a model to boost its presence and share. But things appeared to have worked out with the launch of SUV Magnite, which not only proved to game-changing model but also made the Japanese brand stay invested in the India growth story.

“We have done all trials and errors in the last 15 years in India. Of course, we have learnt from our experiences,” said Gupta.