The Hindu : Business : Nissan, Renault to set up unit in Chennai

Online edition of India's National Newspaper
Saturday, Feb 23, 2008
ePaper | Mobile/PDA Version

Business

Business

Nissan, Renault to set up unit in Chennai

Shanthi Kannan

The greenfield Oragadam facility will go on stream in 2010

— PHOTO: M. VEDHAN

AUTO FOCUS: Tamil Nadu Chief Minister M. Karunanidhi (left); Executive Vice-President, Nissan Motor Co., Carlos Tavares (right), and Executive Vice-President, Product & Strategic Planning and Programmes, Renault Group, Patrick Pelata (second from left), exchanging documents at the Secretariat in Chennai on Friday.

CHENNAI: In an equal joint venture agreement, Renault and Nissan have decided to invest Rs. 4,500 crore ($1,140 million) to set up an integrated greenfield automotive facility at Oragadam near Chennai.

A memorandum of understanding (MoU) in this regard was signed with the Government of Tamil Nadu here on Friday.

The project will come up on 678 acres and will provide vehicle production platforms for the two car-makers. It will also have powertrain facility. The plant will have an installed capacity of four lakh vehicles annually. The facility is expected to go on stream in 2010.

Mahindras opt out of JV

It may be recalled that a year ago, Renault and Nissan along with Mahindras had come forward to set up this project. Mahindras had pulled out of the project citing its commitment to its planned second unit. At that time, the estimated project cost was Rs. 4,000 crore.

Addressing a press conference here on Friday, Carlos Tavares, Executive Vice-President of Nissan Motor, said the plant would produce a wide range of products for both partners, suited both for the domestic and export markets. Currently, he said, Nissan had two products and would be introducing eight new products by 2012. The India-made model vehicles would be four by 2012, he added.

Mr. Tavares said there would be entry-level cars and SUVs. By 2012, nearly half of its models would be India-made. It would bring in products such as entry-level hatch-backs, pick-up vans and family utility vehicles. The local content of its products would be nearly 80 per cent, he added.

Mr. Tavares said Nissan recently concluded a Master Cooperation Agreement with Ashok Leyland and agreed to form joint venture companies for development and production of LCVs and LCV powertrains.

Technical centre

He said both Renault and Nissan would set up a technical and business centre in India, which would be operational by March-end. The centre would look into factors such as product and manufacturing aspects, R & D, cost management, infrastructure and information system. “We are also discussing with Bajaj Auto for producing ultra low cost vehicles. The discussions regarding this are on,” he said.

Senior Vice-President of Nissan Colin Dodge, said “it is a major investment by Nissan into India, next to China. Nissan will like this project to be a world class one and wants it to be a Nissan’s export hub.”

The Oragadam plant would bring out compact cars initially into the market. He said both the companies would share facilities equally.

Mr. Dodge said Nissan was hoping to export 50 per cent of its products from the proposed facility.

Printer friendly page
Send this article to Friends by E-Mail

Business