TOKYO (Reuters) - A proposed $3,000 car that Renault SA and Nissan Motor Co are working on with India’s Bajaj Auto Ltd could come in the three brands’ badges, Carlos Ghosn, head of the Franco-Japanese alliance, said.
“There are three partners, so you can imagine having three different skins,” Ghosn told Reuters in an interview in Tokyo on Friday.
Renault and Nissan have been in discussions with Bajaj, India’s second-largest motorcycle maker, over the feasibility of building an ultra-low-cost car to rival Tata Motors’ $2,500 “people’s car” for Indians who can only afford a two-wheeler.
Ghosn said he would meet Bajaj’s management and the project team on Monday in Pune, near Mumbai, to go over the blueprint.
“I’ve already seen the drawings. We know the kind of engine, transmission, material and size — these things have already been established,” he said. No prototype has been built yet.
“We are in a kind of pre-engineering, pre-conception period, but it’s going to move very fast after that,” he said, repeating that he hoped for a 2010 launch so as not to fall too far behind Tata’s roll-out next year.
Ghosn said that using a new brand altogether was also a possibility, but stressed that one of the vehicle’s aims was to conquer new customers for future purchases of Nissan and Renault cars.
“This is most likely going to be a first car for many people. (Customers’) being familiar with your brand is extremely important for the future of your brand in many countries which are developing but that in 10, 20 years will be developed markets,” he said.
Nissan has virtually no presence in India now, importing the X-Trail SUV by the hundred, while Renault is partnering with Mahindra & Mahindra Ltd to build the low-cost Logan model in large volumes. Both have announced plans for expansion through various partners.
Ghosn said the first step for the $3,000 car was to test it for India, but that a second more important strategy was to try to tune it for export markets.
“The car for India is feasible because somebody is already doing it. Bajaj is very excited about this opportunity and I’m going to support it.
“The question that is a little bit more difficult to answer today is: Can you export this car to other countries, particularly in developed markets? It’s still a question mark.”
Ghosn said the most important requirement for the car was its “robustness” of quality, so as not to disappoint first-time customers. His first car, he said, was a used one made by a “competitor brand” that he never returned to because of its poor performance.
While ensuring a certain level of quality, the partners would also have a strict guidance on profits to ensure that the project was sustainable as a business, he said.
“What’s refreshing about (Bajaj) is that it does a lot of (cheap) products in India — tricycles and motorcycles — and it’s a very healthy and profitable company. For them, low-cost doesn’t mean low-profit.”
Ghosn said if the project goes ahead, Bajaj would engineer and build the car at its factories with access to Renault and Nissan’s technology in “materials, knowledge, data, support, testing — everything they need in order to make the car a reality.”
Tata has said its car would be a four-door model with a 600cc rear engine for both petrol and diesel versions, using moulded plastic and modern adhesives, with an initial production run of 250,000 to 300,000 units.
Nissan is also working on developing a separate family of entry-level cars benchmarked in price against Renault’s popular 5,000-euro Logan model.
Additional reporting by Daniel Sloan