Article: Is Logan's dismal show souring Renault- M&M JV

Quote :

Is Logan's dismal show souring Renault- M&M JV

Is the lacklustre performance of the Logan casting a shadow over the Renault- M&M joint venture? Comments from Renault’s Executive Vice President of sales and marketing seem to suggest that all may not be well. He says there is a need to revise Logan strategy in India.

Patrick Blain, VP, Renault, said, “The segment has turned out to be smaller than we thought. We have subsequently downgraded its 2008 sales target to about 25,000-30,000 units and we are now fighting for a share of a smaller market that anticipated and there maybe a need to revise the product strategy for the Indian markets”.

So clearly they are not too happy with the performance of Logan that they had anticipated in the beginning of the year. They had projected 50,000 units per annum sales but they have been able to now do just about 26,000 in a year.

In fact we did speak with Mahindra-Renault people to get a comment on this statement by Patrick Blain and they said that they are not aware of such a thing and they would not like to comment on it and they want to go ahead with the sales that is going on. They are of course concerned by the overall growth or the performance of the auto sector per se.

We have seen a C-segment where Logan comes in, it competes with SX4 and City and it stands at the number 3rd position with about 12% market share. But in the month of June the sales dropped by a significant number because they sold just about 1,100 units versus the 2,500 unites they normally sell every month that was on account of annual maintenance that the company is says of the plan. The C-segment grew by almost 14% despite all this. The reason for discomfort between the two joint venture partners could be one when Mahindra & Mahindra pulled out of the tripartite agreement between the three, Nissan-Renault from the Chennai plant; they pulled out. That was one of the reasons. Second is, no decision been made so far on the marketing and distribution strategy for the new cars that will come out of Chennai plant from Renault.

So all this is still under discussion. There is no final position and sources are not telling us finally; that in the next three-six months future of the JV would be decided. There could be an exit or they wanting to go along. But there is a possibility and the crack is of course showing on the two partners.

Article sourced from: Is Logan's dismal show souring Renault- M&M JV

Just for Your info Guys

It could actually be right.
But in the automotive point of view, exiting from India at this time would be a foolishness for renault ?(atleast from the mid size segment)

Doesnt seem very believable to me...
I guess Renault has a very good track record world over with its partnerships and i guess they will continue that.
Also i agree with surya that Renault wont be foolish to exit India at this stage when the Logan is finally catching up..

In my opinion, the Logan is doing good numbers. The DZire sells much better, but every manufacturer should know the strengths and weaknesses of its product. Which I think, MR knows.

About the JV, yes.. it will be a foolish step for Renault to exit from India. But, as other manufacturers have done.. it can be on its own and perhaps will not need Mahindra's help in the future.

And if it does exit from the JV, what will happen to all the existing Logan owners? We'll all go to Renault-Nissan's service centres happily

The Logan edge has been introduced guys with all the luxurious features anyone will opt for. tHE jv IS NOT GOING TO end so easily folks. This new upgradations have been done to sustain in the market.

Today, read an article on them planning to export the Logan from India

The article is just about a speculation that the reporter has raised. it can be true, can be false.

They could export to the UK !!!!
Stu

Guys,

Just read this article released by Mahindra - Renault (Dr. Pawan Goenka on 29th July 2008)

Mahindra Renault to jointly sell Renault cars
Posted: 29 Jul 2008 07:01 AM CDT

Mahindra and Renault may extend their retailing partnership to sell Renault’s future cars as well. Through the existing Mahindra-Renault a 51:49 joint venture between both the companies are producing and retailing logan presently. Though Mahindra had pulled out of the proposed Rs 4,000 crore tripartite venture with Renault and Nissan to manufacture vehicles at a new plant near Chennai, Mahindra-Renault may be the distribution network to sell renault’s new cars if the talks fruitfy. “We are negotiating with Renault to sell their new cars, which will be launched in the next two years from Chennai. While there are no talks to take the current joint venture beyond the Logan, and M&M does not wish to introduce any more cars, we are hoping to sell Renault’s cars through our distribution network under Mahindra Renault Ltd,” M&M president (automotive sector) Pawan Goenka said.

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I feel the situation is getting more complicated than it was earlier.
Need to see what will be in store for us loganites.

I for sure wouldnt mind going to an exclusive Renault Service centre

vsuprak wrote:

M&M does not wish to introduce any more cars

very important statement here! So does that means no more cars from M&M? Looks like it has focussed all its energy on utility vehicles!

It also means, as the article suggests, that all logan cars Ieven the sandero, will be manufactured by Renault-Nissan.

Providing only distribution means sharing the logistics, nothing else, right? What about the a.s.s.??

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Renault-Nissan to sell cars through M&M JV

NEW DELHI: Mahindra & Mahindra (M&M) and French carmaker Renault are discussing the possibility of selling cars made in Renault-Nissan’s manufacturing facility in Chennai through Mahindra-Renault, their 51:49 joint venture.

Refuting reports of any break up with the French carmaker, utility vehicle major M&M clarified that both the auto companies are chalking future strategies jointly and are in advanced talks to sell Renault’s new cars that will roll out from its (Renault’s) upcoming Chennai facility in 2009-10 through the joint venture company.

M&M president (automotive sector) Pawan Goenka told ET, “We are negotiating with Renault to sell their new cars, which will be launched in the next two years from Chennai. While there are no talks to take the current joint venture beyond the Logan, and M&M does not wish to introduce any more cars, we are hoping to sell Renault’s cars through our distribution network under Mahindra Renault Ltd.”

M&M had pulled out of the proposed Rs 4,000 crore tripartite venture with Renault and Nissan to manufacture vehicles at a new plant near Chennai. The facility was initially supposed to manufacture models for all the three partners, with an annual capacity of 4-lakh vehicles.

Source:- Economic times!

Hope this puts rumours to rest..
I think Economic times is a much more reliable source..

folks.
something is surely cooking...
public announcements wont help much knowing real story. some insider from top management wont disclose anything... basically we cant know the truth.

If i were Renault i would reorganize whole thing kick Mahindra out of the scene who does not seem to be participating and go on my own.

As such the JV M&R is a perfect one since M dont have sedan or hatchback expertise or technology whereas R does have one and can fill in the gap, securing interests of both M and R.

If Renault is intelligent enough, heres what they should do:-
-Split with Renault / atleast smack their ass and let them know that they sure are one of the worlds biggest manufacturer and wont take things lying down.
-Introduce new interesting and WELL priced models to capture some market share.
-Launch their Own seperate showrooms and service centers even if they continue with Mahindra cause thats the only reason the product isnt seling...

absolutely correct..... however there is a big IF

Renault is one of the best option for mahindra to grow in world market. But god knows what happened in between them. All the competators also want to shut down the JV between these companies because near future they have phase a big competition through a line of good products from Renault and mahindra. So if any one have contacts with the officals of both these companies please tell these matter to them.And another main point is rumours affect a lot for the sale of Logan.

I do not think that the Autoindustry of Mahindra will be a world seller this market is already finalised and also getting mad smaller SAAB OPEL GM ROVER all gone or going Its the bigwigs VW. PORSCH .BMW .TOYOTA .HONDA ,RENAULTthat hold the Key s Stu