Nissan plans 1.3 ltr small car from new Maruti unit

Japanese auto maker Nissan is likely to roll out a 1.3-litre, three-cylinder small car as its first made-in-India vehicle to roll out of Maruti Udyog's upcoming plant in Manesar (Gurgaon). The first Nissan car, according to industry sources, is expected to hit roads in the first quarter of calendar year 2008.

The new small car from Nissan will be used to address both the domestic and export markets.

The initial capacity is expected to be one lakh units a year, which will be ramped up to two lakh units at a later stage.

Nissan has started talks with select component makers in the country, which will supply the critical parts for the car.

Spokesperson of the largest domestic car maker Maruti Udyog, in which Suzuki Motor Corporation owns a majority stake, refused to comment on this development.

Industry experts said Nissan is known in Japan, the US and Europe for its economy class mid-size sedans "� and not for small cars. Hence, the Japanese company's plans to produce small cars in India should definitely have developing markets like India as target.

However, it is not known in which model of Nissan, the 1.3-litre engine, code named XH-5, will be fitted.

Earlier this month, the two Japanese auto majors "� Nissan and Suzuki "� announced a global production alliance, which will see Nissan supply mini vans to Suzuki on an OEM basis starting from 2006-end.

The deal also included Suzuki's commitment to supplying a mini vehicle to Nissan on an OEM basis. Nissan cars are likely to be rolled out of Maruti's upcoming second plant at Manesar.

Maruti is building its new plant with an initial capacity of one lakh units a year.

The fresh demand from Nissan would necessarily mean that India's largest car company has to start planning fresh capacity expansion, which the Suzuki and Nissan's global manufacturing alliance demands.

Maruti Udyog Managing Director Jagdish Khattar, at the time of announcing the alliance between Nissan and Suzuki and its impact on Maruti, had indicated that there was sufficient land at the new Manesar plant and expansion of capacity to accommodate fresh demand from Nissan can be built at the same location.

Industry sources also said a fresh team with a new head is likely to be created by Nissan to handle the India project. Nissan Motor India is currently headed by Managing Director Yoshi Moto Hiro, who is expected to continue to head the sale operations of the company.