Renault to widen network to 270 by Dec as Kwid demand zooms

Renault India will be opening 30 more dealerships by December, taking their number to 270 as against the earlier plan of 240, to meet growing demand for flagship entry-level car Kwid that has become a runaway success for the French auto major.
The largest European carmaker in the country also hopes to close the year with over 5 per cent market share, up from 4.5 per cent as of end June and 1.5 per cent prior to the launch of the Kwid 10 months ago.
"I don't see any chance of the entry-level car segment saturating anytime soon. With 24 per cent of the total market, this still is the largest market and in this segment we are among the top three players for the past seven months, consistently grossing up over 7,000 units every month. For the past two months, we are grossing up 9,000 each.

"And to our pleasant surprise a lot of demand is coming from tier III & IV markets. To meet this, we've reworked our market strategy to open 30 more dealerships by December, which will take our total network to 270 this year (up from 240 planned earlier). In fact, as per our 2014 plan, we were to have only 280 by December 2017," Renault India Chief Executive Sumit Sawhney told a select group of reporters here today.
He said the company ended 2015 with 205 dealerships and today the number is 220. "As much as 70 per cent of the planned 65 new outlets will come up in small towns."

In July, Renault reported a 610 per cent spike in sales at 11,968 units as against 1,686 units in same period in 2015, thanks to the Kwid.

Apart from the customer and dealer trust in brand Renault, his optimism comes from a host of external factors such as a favourable monsoons and resultant good festive sales, rising corporate profits and the 7th Pay Commission award, which will leave lots of money in the hands of the millions of Government employees.
Asked about the waiting period for the Kwid, he said it was around three months and added the company was selling an average of over 7,000 units every month. "We want to bring this down to one-month or so."

Refuting criticism that Renault is a one-model wonder, after the tapering off of its first success story that the mid-level SUV Duster has become, he said, "I don't think the Kwid is a one-time wonder nor we are a one-model car company.
In fact, Sawhney is so bullish about Lodgy that he said
the company will close the year with 1,000 units a month, adding a World Edition Lodgy will be rolled out this month.
Already over 75,000 Kwids are on the road, while the number for Duster is over 1.5 lakh since the launch four years ago, he said.

Incidentally, Lodgy, which is getting lots of demand from fleet operators now, has the highest mileage in the segment, having notched a whopping 47 kmpl on a test-drive from Delhi to Mumbai, Sawhney, who was part of the launch team of the Tavera for GM India, said.
The average mileage is over 15 kmpl on any road condition, he said.
Asked about capacity addition to meet the rising demand, he said the company has added a third shift at the Chennai plant to take the monthly throughput to over 12,000 now, including exports.
But he declined to offer firm sale target for the Kwid, saying "I will be perfectly happy if we sell more than 10,000 units a month."

Sawhney said the company will be launching a 1000-cc or 1-Liter Kwid engine next week. The company has entered the Sri Lankan market in June and will be foraying into Nepal this month itself and Bhutan and Bangladesh before December.
The company will also have an AMT (automated manual transmission) version of the Kwid be Diwali.
He said Renault will also begin SKD (semi-knocked down) production of the Kwid in Brazil and South Africa next year.
Terming the Kwid as the biggest Make in India success story, Sawhney said the model, which was the first global car that the Renault has ever launched outside Europe in its 118 years of history, has 98 per cent local sourcing, the highest among the foreign carmakers in the country.

Since its entry five years ago with a plant in Chennai, Renault-Nissan Alliance has invested over Rs 6,100 crore into the facility at Oragadam that has an installed capacity of 4,80,000 units per annum, and has become the largest European car maker in the country.
Apart from the Duster, Kwid, and Lodgy, the company sells four more imported/assembled models in the country -- the premium sedans Fluence and Scala, luxury SUV Koleos, and the premium compact the Pulse.