Renault to establish engine facility in India

Renault, France based leading car maker, is planning to set-up an engine facility in India. The new facility will possibly be established at company's plant at Oragadam in Chennai. Producing engines in India will help company to ensure availability of engines and transmissions for Mahindra's entry level sedan Logan. It will further reduce the cost of the car when M&M would manufacture Logan on its platform. At present, Mahindra is getting engines and transmissions from Renault’s Romania and Spain units which invites high import levies.Mahindra currently imports three types of engines including a 1.4 lit and 1.6 lit diesel engine and 1.5 lit petrol engines.

Meanwhile, Mahindra has announced a discount of up to Rs 80,000 on the Mahindra Logan model.However, the vehicle does not undergo any technical modifications. Last week, M&M has got exclusive control of the JV Mahindra Renault Pvt Ltd. Company will soon announce the proposed launch of this engine facility, an official of the company reportedly said.

After the start of Renault's engine production unit it will feed engines to Renault, Nissan and M&M. Renault's plant at Chennai has a manufacturing capacity of 4 lakh units of cars annually, on which M&M will produce Logan sedan by availing the technical know-how from Renault.

Renault-Nissan JV, is also in the process of launching a new small car in India in partnership with Bajaj Auto. The car will be developed at Bajaj's two and three wheeler platform, and Mahindra and Nissan will help in marketing and sales of the car. Nissan will also use this facility for the production of its upcoming Micra model, which will compete with popular cars in India including Maruti Swift, Hyundai i10 and Skoda Fabia.