Japanese firm wants to shed its niche player status in India
Nissan Motor Company, Japan’s fourth largest vehicle manufacturer, is set to shed its niche player status in India and become a mass market manufacturer.
In the pipeline are five new products, including the compact car Micra/March (the company is yet to finalise the name) and its sedan version. Its compact car will compete with Maruti Suzuki and Hyundai’s line of models such as Zen Estilo, A-Star, i10 and Santro in terms of pricing and power.
Carlos Ghosn-led Nissan currently sells two models in India — the Teana (a premium sedan) and X-Trail (a sports utility vehicle). Both have received lukewarm response in the market owing to their high price tags, because they are entirely imported.
Nissan Motor India (NMIPL), the Indian subsidiary based in Mumbai, is now constructing a plant in Chennai in association with French partner Renault.
In an email statement, a Nissan spokesperson said the company would produce five models in India. “The first production starts with the next generation of the Micra/March hatchback, followed by the sedan type. The rest is still under study,” the statement said.
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The company will launch new versions of both their existing models next week, with major changes expected on the X-Trail (2009 edition), which will now sport a new body and chassis, enhanced interiors and a new fuel-efficient engine.
The Teana, meanwhile, will undergo a makeover, with substantial changes to the exterior design and styling, as well as the interior. The powertrain will, however, not be changed.
Company executives declined to provide the pricing details of the new versions. The current 2.2 litre X-Trail costs Rs 20-24 lakh and the Teana costs Rs 21.42 lakh (ex-showroom Mumbai).
Sources from auto component circles said Nissan was studying the possibilities of producing the Teana locally either through a direct manufacturing route or an assembly line-up. A locally produced Teana would drastically reduce the price of the car, which is now sold after levying an import duty of almost 110 per cent.
However, owing to low sales volumes — just 120 units last calendar year — the company dropped its plans. In comparison, the Mercedes Benz C-class sells about 1,500 units per year, even though the base variant costs 24 per cent more than the Teana at Rs 26.5 lakh.
Nissan and Renault’s Rs 4,500-crore Chennai plant will go on stream next year, with production slated to start in May. Even though Renault, which owns a 50 per cent stake in the Chennai plant, has hinted that it intends to go slow with its production strategy, Nissan will go ahead with its plans.
The compact car from Nissan will be the first to roll out from that facility, which will have an annual capacity of 400,000 units. Nissan will begin production with a target of 200,000 units and will ramp it up to 300,000 later.