Brand Datsun and the road ahead in India

As Nissan gets set to launch its compact SUV Magnite in India early next year, the interesting twist to the script is the fate of brand Datsun.

It is now well known that the Magnite was intended originally as a Datsun-branded SUV but will now sport the Nissan badge. Perhaps this could also imply the end of the road for the Datsun brand in India which was touted with much fanfare at the time of its Delhi unveiling in 2013.

Clearly, a lot of water has flowed under the bridge over the last couple of years starting with the shock arrest of Carlos Ghosn, former Chairman of Renault-Nissan, in late-2018. A series of dramatic events followed where some big names exited both companies even as relations between the partners worsened by the day.

Neither was in good shape financially either and even while speculation was rife that a divorce was inevitable (never mind that it would have been a long, tedious and expensive affair), Renault and Nissan resolved to bury the hatchet. It was not going to be easy but there was really no alternative especially when it was crystal clear that they could not afford to stay solo at a time when everyone was seeking partnerships.

It is here that the relevance of Datsun in the new global roadmap for Nissan merits deeper analysis. It was Ghosn who had resurrected the brand in an endeavour to position it as an entry-level offering in countries like India, Indonesia, Russia and South Africa.

It was difficult to question his logic considering that almost all of these markets have cost-conscious customers who Ghosn naturally presumed would be delighted to access an affordable car brand. Remember, it was the former Chairman of Renault-Nissan who was the first to salute the Tata Nano’s astonishing price tag and reiterated that it was this level of frugal engineering which would help automakers in emerging markets.

“Today, we begin a new chapter in the Datsun story,” proclaimed Ghosn when he unveiled the Datsun GO at a glittering unveiling ceremony in Delhi seven years ago. “We will offer a modern take on Datsun’s core values in India and pay tribute to the brand’s heritage. The power of local engineering and manufacturing has been used to make this a reality,” he added.

According to Ghosn, India was expected to see four million car sales by 2015 by which time Nissan’s contribution would be 10 new models including the Datsun line-up. “We are expanding operations in India and, going forward, will use local talent to enhance our operations locally and globally,” he said.

Nissan, he added, had high expectations from India and hoped to have a market share of 10 per cent, up from the present 1.2 per cent, in the mid-term. Clearly, the Datsun brand was expected to play a big role in this growth and could contribute to over 60 per cent of sales given the competitive price band it would operate in.

Ghosn’s leadership team that piloted the Datsun in India were equally optimistic while reiterating that the country would be the pivot of the Datsun’s global drive. They touted India as “fundamentally the winner of tomorrow” because the mindset of its people was seen as a combination of development and respect for limited resources. Terming this a “fantastic tool”, this put in context why Datsun was developed in Chennai and not Japan.

Fast forward to the present and it seems almost tragic that none of these plans has worked. On the contrary, Nissan’s market share has been in free fall and is really nothing to write home about. The Datsun journey is a clearly forgettable saga even though its intent could never be faulted. As in the case of the Nano, the cheap car association was perhaps its biggest chink in the armour along with other issues that deterred the buyer.

For now, a lot will depend on the success of the Magnite gong forward. If the script goes according to plan and sales soar, it will be the best piece of news for Nissan as a brand at a time when it is really down though not entirely out. One more setback in India is something that the Japanese automaker just cannot afford at this point in time.