Renault is to set up its own distribution network in India as part of a reorganisation of its joint venture in the country with Mahindra & Mahindra.
Sudhir Rao, chief operating officer of the French carmaker’s local unit, said the two companies would announce details of their plans within the next two months although Renault confirmed in a statement that it would establish its own independent dealer network in India.
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Renault is reviewing the future of the venture with Mahindra, which makes the Logan. The joint venture’s sales plummeted 64% between April and December following a 48% decline in the year ended in March, according to data from the Society of Indian Automobile manufacturers.
Mahindra, India’s largest sport-utility vehicle maker, controls 51% of the venture, which started selling the Logan in 2007. The JV reported a loss of INR4.9 bn (US$105m) in the fiscal year ended 31 March, according to Mahindra’s annual report.
Renault plans to introduce the Fluence and Koleos in India next year and has spent EUR100m ($137m) building a plant in the southern city of Chennai. With alliance partner Nissan it plans to invest INR45bn ($1bn) by 2015.
Country general manager and MD of Renault India Marc Nassif said: “During the recent New Delhi AutoExpo we had announced our roadmap for introducing several cars from our international portfolio in the Indian market. We would like to reaffirm our intention to be a long term player in India, by announcing our plans to set up an exclusive distribution network for Renault cars that will be introduced in the Indian market. We will create an extensive nationwide distribution network in the next 30 months.
“Our experience at the New Delhi AutoExpo has been extremely positive and the feedback we got from the thousands of visitors to our pavilion shows that there is a good market for cars from the Renault range. We have carried out extensive customer surveys and have identified the right cars from our global range for introduction in the Indian market.”
