Renault on Thursday afternoon (BST) confirmed it would build a version of its Logan low-cost car at its Curitiba, Brazil, plant for sale in Mexico under the Nissan brand.
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Annual Brazilian production capacity for Logan X90 platform vehicles is 110,000 units, destined for the home market and for export, mainly Argentina and Nissan-badged models for Mexico.
To increase daily production from 300 to 450 vehicles, Renault introduced a second shift in the Ayrton Senna complex’s passenger car assembly factory at the beginning of April 2007 and recruited 600 extra employees.
The South American Logan will feature a high degree of local content, with 80% of parts produced in Brazil. The objective is to increase this to 90% by 2009.
The French automaker said the May launch of the Logan in Argentina, and in Brazil next July, is another step forwards for its Renault Commitment 2009 programme.
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By GlobalDataThe gradual introduction of vehicles based on the X90 platform boosts production capacity utilisation at Curitiba, the automaker said.
Renault’s plan for growth in Latin America is under way, with an expansion of the range, increases in production and sales, staff recruitment and the development of the sales network.
“Logan epitomises Renault’s bid to win over a new target market in the region, namely a family clientele looking for a spacious, affordable vehicle that is also both robust and easy to maintain,” Renault said in a statement.
“The region’s two main automobile markets – Brazil and Argentina – are currently expanding and represent significant potential for Renault. In 2006, a total of 1,834,581 vehicles (cars + LCVs) were registered in Brazil, plus a further 420,356 in Argentina. These volumes represent an increase of 28% and 57%, respectively, from 2004 to 2006.”
Renault has operated its Santa Isabel plant in Cordoba for over 50 years and said that the brand can bank on strong brand awareness as it launches Logan in Argentina where it claimed a market share of 11.5% in 2006. The three-box Logan joins the existing range: Laguna II, Scénic I, Mégane I (4- and 5-door versions), Mégane II (wagon, 4- and 5-door versions), Clio II (3-, 4- and 5-door versions), Kangoo and Master.
This line-up will be further boosted by the import of Grand Scenic II starting this month, followed by the Mégane II coupe cabriolet in June.
Renault noted that three-box saloons are particularly popular in Argentina and Logan is aimed essentially at family buyers.
Following the new Mégane in March 2006 and Mégane Grand Tour wagon in November 2006, Logan is the third vehicle to be launched in Brazil under Renault Commitment 2009. The Logan will be available there with the bioethanol powered engines required for this market, and these flexfuel engines will be a world first for the Logan range.
As in Argentina, Logan is essentially set to appeal to the Brazilian family buyer looking for a practical, spacious car at an attractive price, Renault said.
The automaker will launch three other models before the end of Renault Commitment 2009 and, with a renewed range adapted to local demand, Renault do Brasil is aiming to double its sales and generate a positive operating margin.
The Ayrton Senna complex in Curitiba (Parana State) comprises three factories: an LCV factory producing both Renault (Master) van and Nissan (Frontier and Xterra) pickup/SUV models, a passenger car factory and a powertrain plant that supplies South America.
Inaugurated in 1998, the passenger car body assembly factory currently produces Clio, Clio sedan, Mégane, Mégane Grand Tour wagon and Scénic.
The Logan is the third model to be introduced at Curitiba in a year. The passenger car factory has a total production capacity of 200,000 and the Logan will be the line’s sixth vehicle, enhancing the factory’s flexibility and optimising facility use.
Since its launch in September 2004, more than 450,000 Logans have been sold worldwide. This year, production is also starting in Iran, India and Brazil. The Logan is currently manufactured in seven countries and sold in 55 markets.
The X90 Programme represents a significant share of the targeted volume increase of 800,000 vehicles specified in the Renault Commitment 2009 plan.
Elsewhere in South America, the Logan is assembled in the Colombian Sofasa plant in Envigado. Sales began in September 2005 in Colombia, Venezuela and Ecuador.
The Logan programme has also met with considerable success in Europe, where the range has been extended to include a wagon version (Logan MCV) and utility (Logan Van). The first two months of 2007 saw Logan MCV sales reach 5,500 in the European and Turkish markets.
In its first week on sale – as the Tondar-90 – in Iran, customers ordered almost 85,000 vehicles, which is equivalent to the year’s total production.
The model is built in the factories of Renault’s two Iranian partners – Iran Khodro and Pars Khodro – and production capacity will reach 300,000 units per year by 2009.
Meanwhile, in India, the first Logan rolled out of the Nashik factory on 4 April last week, less than two years after the signing of a joint venture agreement with Renault’s Indian partner Mahindra.
Brazil-Mexico FTA brings opportunities
