Renault, Mahindra to jointly build auto plant in India

RP news wires, Noria Corporation

Renault and Mahindra on November 9 signed a memorandum of understanding to establish a long-term strategic partnership in India. Under the agreement, Renault and Mahindra would create a greenfield site with capacity of 500,000 units per year within five years, offering innovative products to their customers in India.

 

Capitalizing on the existing joint venture with Mahindra to commercialize Logan in India from first half of 2007, this strategic partnership would present a win-win situation for both companies and for Indian customers.

 

“I am delighted to announce the deepening and enlarging of our partnership with Mahindra in what I see as a great opportunity for Renault’s development in India,” said Carlos Ghosn, president and CEO of Renault. “This gearing up of our presence in one of the fastest-growing markets in the world is key to our commitment to international growth.”

 

Anand Mahindra, vice chairman and managing director, M&M, said, “The success of this partnership is scripted within the India growth story and Mahindra and Renault’s shared vision for its customers. It is a chemistry that we discovered when the Mahindra-Renault joint venture was born. Besides, the strengths of Mahindra and Renault will go a long way in making India a key global automotive market.”

 

A range of Mahindra as well as Mahindra-Renault products suited to the requirements of Indian customers will be manufactured at the new greenfield production site under the direction of Renault and Mahindra. The production site will include a vehicle assembly plant, shared between the two partners. Renault also plans a powertrain factory. Production is expected to begin mid-2009, with an initial installed production capacity of 300,000 vehicles per year. The manufacturing site will be announced shortly.

 

The product range will be marketed by Mahindra-Renault and sold through the extensive and well-established Mahindra channel network throughout India.

 

Partners will optimize production costs through economies of scale thanks to joint investment in plant and infrastructure, as well as purchasing synergies.

• Renault will contribute its expertise in engineering, manufacturing and adaptation to meet customer requirements, and

• Mahindra will contribute its in-depth understanding of the Indian market and supplier base through years of market leadership.

 

Both companies have the same focus on product innovation and strategy; both strive for customer service excellence and global competitiveness.

 

“Mahindra and Renault’s joint vision is defined, however, by more than just these factors. It is centered on our common wish for growth that will only come with making products to suit the customer’s needs around the world,” said Anand Mahindra.

 

“I’m confident in our balanced and fruitful cooperation to offer the best of Renault and Mahindra to Indian customers,” said Ghosn.