Renault Succeeding With Aggressive Push Into India

MUMBAI – Renault India doesn’t sell the most cars in the country, but in terms of growth it’s leaving other brands in the dust.

The auto maker reported sales of 6,790 units in October, compared with just 173 year-ago. Last month’s total roughly matched its deliveries over the first nine months of 2011.

The Duster cross/utility vehicle led the charge, joined by the Scala sedan and Pulse hatchback. The Duster reportedly ranked 36th in Indian sales in July, its first month on the market, then vaulted to 21st in September and 15th in October.

The CUV has a waiting list of 20,000 would-be buyers, clearing the way for Renault to raise prices by Rs30,000 ($550) for the gasoline model and Rs40,000 ($730) for the diesel version.

Renault’s success in India can be attributed in part to rebadging, which produces high-quality, relatively inexpensive vehicles that save on development time. The Scala and Pulse are rebadged versions of alliance partner Nissan’s Sunny and March, respectively.

The Duster, Koleos midsize CUV and Fluence midsize sedan brands are carried over from Renault’s lineup elsewhere.

Managing Director Marc Nassif also credits the auto maker’s dealer network, which is being expanded from 65 to 100.

“By next year we want to deliver 80,000-100,000 cars,” says Len Curran, outgoing vice president-marketing. The higher figure would represent about 3.4% of Indian light-vehicle sales in 2011, according to WardsAuto data.

Renault-Nissan Automotive India is a 30-70 joint venture that opened a Rs45 billion ($990 million), 400,000-unit-capacity plant in Chennai in March 2011. The facility produced 75,000 units last year and is expected to build 250,000 this year.

Renault aims to repeat the Duster’s success with another low-cost model, the Lodgy multipurpose vehicle, sourced from the auto maker’s Dacia subsidiary. Slated to launch in 2015, it will offer both diesel- and gasoline-engine options. The less-successful Fluence

is getting a facelift and available diesel engine by 2014.

Renault shares the Chennai plant with Nissan, which saw monthly sales peak at 5,857 units in March on the strength of Micra compact-sedan and Sunny deliveries. Renault’s Koleos and Fluence also are produced at the facility.

Two months ago, Nissan launched the upmarket Elavia MPV vehicle, which competes against the Maruti Suzuki Ertiga, Mahindra Xylo and Toyota Innova as well as the forthcoming Chevrolet Enjoy and Ford EcoSport.

Renault’s growth in India belies its status as a relative newcomer to the country.

The auto maker doubled capacity of its Chennai plant three years ahead of schedule, and aims to double capacity again to 800,000 by 2016. It intends to field as many as 22 models across all light-vehicle segments over the next four to five years, supported by more than 2,000 engineers and technologists at a research-and-development center shared with Nissan.

The Renault-Nissan JV has 7,500 employees. To ensure high levels of human-resources efficiency and production quality, the auto makers have retained Kronos, a U.S.-based multinational workforce-management-services provider.