Mahindra & Mahindra
(M&M) is gearing up for a big push in the passenger car market with Renault.
The homegrown auto major has made a proposal to the French company for joint
badging and distribution of new cars that roll out from the Chennai factory, in
a bid to expand relationship with Renault beyond the no-frills sedan Logan. The
Chennai facility is scheduled to start production from 2010.
The joint initiative can increase M&M's offerings and stake in the fast-growing domestic car market, while providing the Carlos Ghosn-led auto major a strong partner for next phase of growth in India.
"We are working on how to take the relationship forward. The attempt is to see whether Mahindra's joint venture with Renault could be the distribution channel for all of Renault products in India... We are talking to Renault very seriously right now," Pawan Goenka, president of Mahindra's automotive business, told TOI. A distribution agreement is also expected to lead to joint badging, cars sporting both Renault and Mahindra brand names.
When contacted, a spokesperson for Renault confirmed the development. "We are having discussions with the Mahindra group and these could further enhance our existing relationship. While our current tie-up is for production and distribution of Logan, we are looking at expanding the scope to include distribution of Renault cars through Mahindra-Renault joint venture," he said, adding that joint badging was the "stated intention" in the discussions andMahindras brought in a good distribution reach for the company.
While M&M is a leading utility vehicle player with Scorpio, it has decided not to get into the highly-competitive passenger car business on its own. It entered the segment with Logan. And if Renault extends this to more products, Mahindra could be a serious player in this area.
The French company plans to roll out four new cars from its Chennai factory, including small and big ones. It has plans to create a capacity of 200,000 units for Renault cars, while a similar amount will be produced by group company Nissan, which has tied up with Hover Automotive India for marketing, sales, after-sales service and dealer develoment.
After initially being part of Renault and Nissan's Chennai car plant, M&M had earlier this year decided to part ways. Asked what the reasons behind the move were, Goenka said there were no differences between the three companies.
"We did not have a joint venture that we walked out of. We did not sign a joint venture. Clearly, if we walked out in disagreement, we would not talk today of joint distribution.
So, it was a mutually-agreed deal that we will not be part of production."
Goenka said a final decision on the discussions would not be far. "It should happen soon. Maybe, a couple of months and not a year. Remember, the products are coming out from mid-2010."
Source : The Tmes of India, "M&M pans a Drive in the Fast Lane"
The joint initiative can increase M&M's offerings and stake in the fast-growing domestic car market, while providing the Carlos Ghosn-led auto major a strong partner for next phase of growth in India.
"We are working on how to take the relationship forward. The attempt is to see whether Mahindra's joint venture with Renault could be the distribution channel for all of Renault products in India... We are talking to Renault very seriously right now," Pawan Goenka, president of Mahindra's automotive business, told TOI. A distribution agreement is also expected to lead to joint badging, cars sporting both Renault and Mahindra brand names.
When contacted, a spokesperson for Renault confirmed the development. "We are having discussions with the Mahindra group and these could further enhance our existing relationship. While our current tie-up is for production and distribution of Logan, we are looking at expanding the scope to include distribution of Renault cars through Mahindra-Renault joint venture," he said, adding that joint badging was the "stated intention" in the discussions andMahindras brought in a good distribution reach for the company.
While M&M is a leading utility vehicle player with Scorpio, it has decided not to get into the highly-competitive passenger car business on its own. It entered the segment with Logan. And if Renault extends this to more products, Mahindra could be a serious player in this area.
The French company plans to roll out four new cars from its Chennai factory, including small and big ones. It has plans to create a capacity of 200,000 units for Renault cars, while a similar amount will be produced by group company Nissan, which has tied up with Hover Automotive India for marketing, sales, after-sales service and dealer develoment.
After initially being part of Renault and Nissan's Chennai car plant, M&M had earlier this year decided to part ways. Asked what the reasons behind the move were, Goenka said there were no differences between the three companies.
"We did not have a joint venture that we walked out of. We did not sign a joint venture. Clearly, if we walked out in disagreement, we would not talk today of joint distribution.
So, it was a mutually-agreed deal that we will not be part of production."
Goenka said a final decision on the discussions would not be far. "It should happen soon. Maybe, a couple of months and not a year. Remember, the products are coming out from mid-2010."
Source : The Tmes of India, "M&M pans a Drive in the Fast Lane"
Awesome news, Now that we know that the Logan wont be alone for long, we can also rejoice because Mahindra Renault is here to stay..