Renault has taken over from Italian rival Fiat a plan to sell a low-cost vehicle in Morocco, industry and government officials told Reuters.

The French carmaker reportedly plans to sell 6,000 of an economic version of its light commercial Kangoo model in 2004, assembled in the Casablanca-based Somaca plant, and sold with a minimum price tag of 109,900 dirhams (€9,980).

According to Reuters, the plan is an interim one until Renault starts building a new "economic car" in July 2005, a model destined for sale not only in Morocco but also eastern Europe and Russia for around €5,000.

"Renault signed on Tuesday a deal with the Moroccan government for the commercialisation of the Kangoo as the new economic car," an Industry and Trade Ministry spokeswoman told the news agency.

A Renault spokesman reportedly said the firm had sold about 15,600 Kangoo vehicles since its launch in Morocco in mid-1999.

Reuters noted that the French firm last year agreed to raise to 46% from 8% its stake in local assembler Somaca, by buying the government's 38% stake in the firm before November 2005.

Fiat and Peugeot hold 20 percent each in Somaca, the report added.

Reuters added that Fiat launched the first locally assembled economic car in 1994 with prices starting at 70,000 dirhams and stopped production in 2003, citing high costs and weak sales.