CHENNAI, Feb 13 (PTI): Franco-Japanese automotive alliance Renault-Nissan on Monday announced an investment of USD 600 million (Rs 5,300 crore) in India to bring six new products, including two small electric cars, and upgradation of their Chennai plant.
The new vehicles will also include four SUVs with conventional engines, the first of which will hit the market by 2025. Of the six vehicles, three each will be for Nissan and Renault.
The alliance expects the fresh investments to create 2,000 new jobs in the country through additional R&D activities and it also has plans to locally produce electric vehicles in India.
Related Posts:
Nissan Global chief operating officer and member, Alliance Board, Ashwani Gupta, in the presence of Tamil Nadu chief minister M K Stalin and Renault India Country CEO Venkatram Mamillapallee exchanged a memorandum of understanding with the state government promoted nodal agency Guidance Bureau MD and CEO Vishnu Venugopal at an event here.
The two firms are also restructuring the capital structures of their joint manufacturing and R&D arms in India to make them equal partners.
The announcement follows the restructuring of the alliance’s global structure earlier this month, putting both Renault and Nissan in an equal footing, doing away with the earlier dominance of Renault.
“We are writing the next chapter for the alliance in India after the global alliance announcement we did in London about getting into the next level,” Gupta told reporters in a virtual interaction.
He further said, “What does it mean for us in India is we are going to develop, manufacture, sell and export six brand new vehicles, out of which four are SUVs and two are A segment EVs. To do that, we are going to invest USD 600 million or Rs 5,300 crore of investment and 2,000 more employment.”
It will be a shared investment between Nissan and Renault, Gupta added.
In addition to that, the alliance will make their Chennai manufacturing facility to be 100 per cent based on renewable energy by 2045, he added.
Nissan’s Africa, Middle East, India, Europe and Oceania region chairperson Guillaume Cartier reiterated Renault and Nissan’s commitment to the Indian market and its electrification to minimise impact on the environment.
“India was the first alliance plant and India will be at the centre of this new chapter of the alliance, with new vehicles, new R&D activities and new export markets taking our joint operations to the next level,” he added.
Similarly, Renault Group chief purchasing officer and managing director of Alliance Purchasing Organisation (APO), François Provost, said, “India is a key market for Renault Group…India has also a key role in our R&D worldwide footprint. This project together with Nissan is the first concrete output of the new Alliance ambition released on February 6.”
On the timeline for the investment and launches of the new products, Gupta said, “We have already started (the investment) because we have already started working on the products. I think the first product will be (launched) 2025 and then in a very few years after 2025 this investment will be fully finalised.”
He said the SUVs will be positioned in the fast growing mid-sized ‘C segment’, while the two electric cars will be in the small ‘A segment’ category.
This investment is purely for the six new models and some of the modernisation that would be done at the Chennai plant to make it utilise up to 80 per cent capacity for local as well as for export, he added.
The alliance plant at Chennai, run by Renault Nissan Automotive India Pvt Ltd (RNAIPL), has an installed annual production capacity of 4.8 lakh units.
Gupta said the current capacity utilisation is 49 per cent and “with these products, we will be reaching up to 80 per cent of production capacity utilisation, for local as well as for export needs.”
“Having said that, when we talk about battery electric (vehicle), this plant will need some investment in the modernisation with the new technology that we will be continuing to do and that may not be fully included into the USD 600 million dollars of investment,” he added.
In the near future the alliance has no plans to increase the capacity and the target is to use the full installed capacity, using local as well as export volumes.
It has been nearly 15 years since the Renault-Nissan alliance announced plans of a manufacturing facility in Chennai, Gupta said adding, “Since then, our factory (in Chennai) has produced more than 2.4 million cars and exports to over 108 countries.”
On the localisation of EVs, Gupta said the alliance is working on it in order to have a competitive supply chain, including the battery, as the final goal of battery electric car is to have “everything glocal for local” but added, “we are not ready yet to share with you how we are going to make it happen”.
Under the new framework of agreement, Renault Nissan Automotive India Pvt Ltd would move to an ownership of 51 per cent Nissan and 49 per cent Renault from 70 per cent Nissan and 30 per cent Renault earlier.
Renault Nissan Technology & Business Centre India would move to an ownership of 51 per cent Renault and 49 per cent Nissan from an earlier holding structure of 70 per cent Renault and 30 per cent Nissan.
“This equal partnership will help us unleash all the potential in the future,” Gupta said.
The alliance said the changed holdings “reinforces the partnership for the long-term and will empower the joint ventures with more responsibility and more autonomy”.
Tamil Nadu industries department additional chief secretary S Krishnan said, “The Renault-Nissan Alliance in Tamil Nadu has had manufacturing and design facilities operation in the state for more than 15 years now. This is a very valuable and important relationship for the government of Tamil Nadu and the Alliance. It employs about 15,000 people indirectly in the State…”
