French car maker Renault, which is driving into the compact car market to gain volumes, has ruled out plans to enter the sub-1.5-litre segment.
The car maker has also said that it has a plan in place — which includes introducing petrol versions for its compact cars — in case the Government decides to impose higher levy on diesel cars during the next budget.
Renault India Vice-President for Sales and Marketing, Mr Len Curran, told
Dealership factor
He also pointed out that to launch a sub-1.5-litre car it would need a far bigger network of dealerships across the country, which the company does not have currently.
Renault had earlier said that it would launch five cars in 18 months, of which it has already launched two so far.
Diesel levy
Mr Curran said the company was aware of the fact that there was a possibility the Indian Government would levy a higher duty on diesel cars. “If they do so, we already have a plan in place. We will look at launching petrol variants of our compact cars,” he said.
Tie-up
Mr Curran also said that even though the Indian market was tough and they were late entrants in the compact car segment, they had a good chance of success because they have “plenty of experience in selling hatchbacks.”
Renault has also tied up with two car financing companies, Kotak Mahindra as well as HDFC, to offer seven-year finance scheme, which Mr Curran said was unique for the Indian market. It has also “adjusted” prices of components in the replacement market so that customers are able to pay less to buy them.
Renault has also set up a distribution centre in Pune which sources components for its global requirements from local vendors.
Last year, it sourced about €70 m worth of components. This year it plans to source nearly €120 million worth of auto parts .
Renault shares the Indian manufacturing plant with its partner Nissan and expects to sell about 1 lakh cars within two years.