Renault do Brasil has abandoned a project to produce a new "world car" in its plant in São José dos Pinhais, Paraná state, writes Rogério Louro. Since 2002 the company has been considering producing a new compact car for the Brazilian market and export to Latin America and Europe, but sluggish new car sales in Brazil, Argentina and Venezuela have led to the project being cancelled.

A flat new car market in Europe also contributed to the decision because around 40% of the production volume would have been exported to the continent.

The new car was to have been based on the next-generation Clio platform (which is shared with the Micra/March produced by Nissan, 44% controlled by Renault) and was scheduled to enter production in 2005.

Renault do Brasil intended the new car project to boost the productivity of its plant in São José dos Pinhais. The factory can build 150,000 units a year, but last year produced only about 60,000 vehicles.

At the beginning of 2003, Renault do Brasil announced that its production units in Brazil, Turkey and Mexico would compete for the contract to build the new car. But a spokesman could not tell just-auto if the new model would now be produced in another country.