Renault has said it is freezing its project to build cars at Chennai in India.
Dow Jones reported that Patrick Blain, executive vice president for sales, told reporters that the freeze doesn’t mean that the project has been shelved. “We had a date” for the completion of the project, he said, but “we no longer have a date.” Renault’s project “is still alive; it hasn’t been canceled.”
The project is a joint venture between Renault and its alliance partner, Nissan that initially envisaged two production lines for entry-level vehicles and sports utility vehicles adapted to the local market.
Nissan’s production line is going ahead as planned, Blain said.
A spokeswoman for Renault told Dow Jones that Renault will fulfill its investment obligations for the plant’s infrastructure. “But we are still undecided on which vehicles we will eventually make there,” she said. It wasn’t immediately clear how much of Renault’s share of the total investment had been frozen, the news agency said.
Renault’s chief operating officer, Patrick Pelata, in November said that the Chennai project had been scaled back to one production line from two.
Renault has also said it is reconsidering plans to build the Logan station wagon with India’s Mahindra & Mahindra Ltd, the report added.
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Separately, Nissan has said that a project working with Bajaj Auto to build a low-cost car in India is on track, but the company is assessing the market potential.
“We are checking the visibility of the market. Our first priority is to maintain cash flow,” Shouhei Kimura told reporters when asked if the project would be delayed.
