Renault’s roadmap for global entry car in India

Carlos Ghosn, Chairman & CEO, indicated this in his presentation, ‘Drive the Change’, during the company’s 2013 results some weeks ago. The car will make its debut in India before heading out to Brazil and South Africa as part of Renault’s strategy for new growth markets.

Its global ally, Nissan, is following a similar business model where the Datsun brand has been revived for a host of new markets. The first launch will be in India next week followed by Indonesia, Russia and South Africa. Renault and Nissan have jointly invested in the facility in Chennai, tipped to be its manufacturing powerhouse for Asia-Pacific, Latin America and Europe.

Ghosn had, during his visit to India last year, made known that the alliance was working on a new platform for entry cars. The Renault initiative is being spearheaded by Gerard Detourbet, referred to as the father of its entry car programmes which include models like the Logan and Duster. The car will cost under Rs 4 lakh, a price segment which accounts for a lion’s share of India’s automobile sales.

The company says it will build on the momentum generated by the Duster. The car is expected to be on the roads by end-2015 and challenge players like Maruti and Hyundai.

Ghosn has constantly reiterated that frugal engineering holds the key to his company’s strategy in emerging markets. It was the Tata Nano’s pricing which first caught his eye and prompted him to kick off the ultra low-cost car project with Bajaj Auto. What began as an entry price point of Rs 1.5-2 lakh has since moved to a more pragmatic space of Rs 3.5-4 lakh where Detourbet is working on making this a reality.

For Renault, the Duster has been an enormous help in establishing its brand in India. Things looked bleak when the Logan did not quite live up to expectations and the house had to be put in order all over again. Market conditions are expected to be better when the entry car debuts next year.

Between now and end-2015, it remains to be seen if other countries will be added to its kitty. For instance, Renault is formulating a strategy for Asia-Pacific and it will be interesting to see if this car will fit into a market like Vietnam or Indonesia in the coming years. As part of its endeavour to grow its business beyond Europe, Renault will also enter China through a joint venture with Dongfeng Motor. The present plan involves annual production of 1.5 lakh cars over the next three years and the focus could be on SUVs and luxury sedans to suit the tastes of Chinese buyers.

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