BANGKOK: Carlos Ghosn, who heads both Nissan Motor Co and Renault SA , said a new, cheap car the partners hope to build for India's booming small car market will not compete directly with Renault's Logan.
Ghosn said Nissan and Renault were looking closely at the feasibility of building a $3,000 car in India in a venture with tractor and utility vehicle maker Mahindra and Mahindra that would go head-to-head with Tata Motors Ltd.'s sub-$3,000 "People's Car" due for launch next year.
Annual car sales in India are set to nearly double to 2 million by 2010, with small cars making up more than two-thirds of the market. Big emerging economies such as India, China and Russia are the new battleground for global auto makers as sales slow in fiercely competitive mature markets.
"We cannot accept to be completely taken by surprise by somebody coming with a $3,000 car that could have a potential bigger than India. Nissan and Renault are working on it," Ghosn told a news conference in the Thai capital.
"One car manufacturer says it is to bring a $3,000 car to India next year and it is a challenge we take seriously. We will be ready when the car comes to the market, we will have enough information, research, discussion," Ghosn said.
"Our obvious partner is Mahindra and we are working with them, but we have not finalized any agreement yet."
Ghosn said the super low-cost car under study would not directly compete with the Logan that made its debut in India last month.
Indian-assembled Logan cars cost about $9,840, while those made in Romania go for about $8,510. Logans are also assembled in Russia, Iran, Colombia, Brazil and Morocco.
Nissan, Renault and Mahindra are building a plant in Chennai in southern India that would roll out up to 400,000 vehicles a year from mid-2009.
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