Mahindra-Renault going strong

Here is the link to the article Bajaj, Renault-Nissan to launch low-cost car in 2012 http://www.prokerala.com/news/articles/a92045.html

Renault plans to go strong for small car...

today's TOI says small car not to carry bajaj badge but rather renault badge.

anyways this is a new venture and in fact does not mean anything to us i suppose.

Mir... wrote:

Renault plans to go strong for small car...

today's TOI says small car not to carry bajaj badge but rather renault badge.

anyways this is a new venture and in fact does not mean anything to us i suppose.

As long as Renault is there in some form in India, we can always publicly harass them for spare parts and maintenance..

I understand that Logan Production is fully stopped at the Nasik plant after the Diwali deliveries. there are some issue to be resolved between Renault and Mahindra.

Can anyone confirm on this.

From where did you understand that production stopped post diwali...

On the issues part, yesterday there was a headline scroll on news reading "Issues with M&M resolved" No details yet known as to what were the issues...

Today's industry update news says that Carlos Ghosn (thru Renault India) has communicated that the primary cause of concern for differences between Mahindra & renault, was the Logan.

This because, the logan did not do as well as both the companies expected. However, he cited that this was not the end of the road and not a dampener.

He said that they have now had some understanding and are on a plan to revive the logan sales.
He also cited the fact that (I quote, in not exact words though)

"The problem is not the Logan. Customers who bought it are completely satisifed with their decision. It is only the sales which are poor and the pricing in the current scenario which has made matters bad. Additionally, being over 4 mtrs, it attracts higher excise duty. We never anticipated that a difference of 2-3 % in the overall price would mean so much to the customer. India is a country where customers are very sensitive to price. We are working on the issues and are also looking at bringing in the new Logan, once the issues are sorted.
Additionally, we are also looking at bringing in newer models at competitive prices which will further support our intention of staying in India"


Now, I really hope the actions happen as fast as those words came out of the mouth.

Very true. Good strategy...

Bring down the sales price, by compacting the dimensions a bit so lower taxes are levied. Nice.

But then in that case Logan looses its USP of being the biggest SEDAN in its class.

Phew..
Finally sum good words!!
Relieved on reading them!!

http://connect.in.com/mahindra-renault/article-brenaultb-bmahindrab-to-revamp-logan-d3951bf37ae71e2c9eb6e3e6449055f4daaad550.html

Indeed those are some assuring words, but what is likely to happen in the midst of all this is that the logan becomes the scape goat till such time issues are settled and new models are introduced.

Regarding shortening of the logan length under 4 mtrs, i foresee another conflict waiting to happen between Mahindra & Renault. This beacuse. the facelifted Logan is already on sale elsewhere, and frankly, Renault would not be in a good agreement to reduce the size exclusively for India.

Then, as mentioned by Ghosn himself, the indian customer is very sensitive on pricing and that additional burden of the excise will be a deterrent, yet again

I think its just to wait and watch how things unfold from here on.
Let them bring the new logan and price it right. There will be customers willing to buy it even if it is over 4 mtrs, if the price is right and it proves to be a vfm

http://www.dnaindia.com/money/report_m-and-m-blames-renault-for-logan-jam_1310885

Hmmm ... MM says its all Renault's fault

Dunno if this has become a habit with Mahindra's but if you notice, even in the past, they have used JV's to enhance their own learning of manufacturing cars.

Case1: Mahindra - Mitsubishi JV --> Voyager (Learnt how to make UV's)
Case2: Mahindra - Ford JV --> Escort (Tried hands at Sedan manufacturing, the Ford way)
Case3: Mahindra - Renault JV --> Logan (Tried hands again at Sedna manufacturing, probably hoping to bank on the success of the Logan and Renault, wordlwide).

Now, somehow, it seems that Mahindra can actually not stick with any particular company in the long run

I see Mahindra's strategy is to enter in some JV and make their own portfolio stronger by learning the technologies of different car manufacturers.

Scorpio, Xylo, Bolero could be result of such technological knowhows and expertise sharing experience M&M gained.

Yesterday in NDTV I saw Carlos Ghosn saying that Logan was launched to study the Indian market. His words show that he is very determined to be aprominent player in Indian car industry. He also stressed on the fact that he wants to localise the product parts.

December's Autocar Magazine has an article which apparently quotes Carlos Ghosn stating that "There were some issues with Logan due to the JV with Mahindra and by January (Auto expo 2010) the JV will oficially be dissolved"

Whats that supposed to mean?

If that's the case then I guess Renault is thinking of producing cars all by itself in India. No more tie-ups. In the previous interview he was so determined to remain in the Indian market. Just by producing low cost cars with Bajaj should not make a company like Renault happy.

Just watch the way Volkswagen is doing the marketing in India. Renault must have understood a lot through Logan since that last 2.5 yrs.

vsuprak wrote:

December's Autocar Magazine has an article which apparently quotes Carlos Ghosn stating that "There were some issues with Logan due to the JV with Mahindra and by January (Auto expo 2010) the JV will oficially be dissolved"

Whats that supposed to mean?

Is this available online somewhere?

i have not received my December issue as yet :'(
Will have to talk to them now !!

sAuMiL wrote:

i have not received my December issue as yet :'(
Will have to talk to them now !!

It is there on the stands..

Yea but i am a subscriber! Should've got it much earlier!

Anyways, heres a statement contradictory to wat Autocar says,

Renault to continue with M&M for Logan, says Ghosn

Renault has no intentions of upsetting the applecart with Mahindra & Mahindra on the Logan project.
“The Logan will continue to be developed with M&M,” Carlos Ghosn, Chairman and Chief Executive Officer of Renault-Nissan, told Business Line during his recent India visit.
However, it is still not clear if there will be any change in the retail strategy for the car. At present, it is showcased with M&M’s Scorpio sport-utility vehicle in the company’s showrooms. Renault is clear, though, that it is working on an independent retail strategy for its future India products and it remains to be seen if the Logan will be part of this revised plan.
“The only thing that has to be clarified for Renault is how to market and sell our products. This is not an issue with our partner, Nissan because its retail plan is in place. Renault is working on something and is clear about an exclusive identity in the form of showrooms, advertising campaigns and so on,” Ghosn said.
M&M and Renault entered into a 51:49 partnership three years ago to manufacture the Logan sedan. The car promised plenty but monthly sales have been at the sub-500 unit level for sometime now and losses last fiscal totalled nearly Rs 500 crore. The Nashik plant has been planned with an installed capacity of 50,000 cars annually.
M&M believes that the way forward is to reduce the length of the Logan to four metres so that it qualifies as a small car in the Indian context and can avail of the lower eight per cent excise duty (instead of the current level of 20 per cent). This is applicable to any car up to four metres long whose engine capacities do not exceed 1.2 litres for petrol and 1.5 litres in the case of diesel.
“The excise duty is an issue in India but we need to continue to work on the Logan to adapt it to local tastes. We also need to do it quickly and with a good knowledge of what customers want,” Ghosn said.
According to him, the other solution lay in localisation of components which would play a key role in bringing down costs. It now remains to be seen which of these options would be exercised though he was categorical that both parties would work jointly on finding an answer.
“We need to do it with M&M as they have shared responsibility on the car and also possess knowledge of the Indian market. We need to decide the solution together,” Mr Ghosn said.
It now looks as if the partners are working overtime to get it right. “Hopefully, before the Delhi Auto Show kick of in January next year, you could see many things becoming clear in these small, grey areas,” he added. It will be interesting to see if some of these initiatives include a new product line-up for the Nashik plant.
Trimming the Logan will help reduce its price tag by at least Rs 50,000 but dealers are not entirely certain if that alone would suffice especially when substantial discounts are already being offered on the car to keep it moving off the shelves.
Ghosn said that the Indian customer is “value-driven and wants everything in his car” which seems to indicate that Renault may even work on some internal aspects of the Logan in terms of offering more goodies at the same price, or even lower if its length is also reduced. The car, he added, has been a huge success in Russia, Europe, North Africa and Brazil.
“We are surprised that it could not be replicated in India. The Logan is important for Renault’s future because it is the first product from us in this country,” Ghosn said.

What I can make of this, is that the LOGAN will no longer be sold through Mahindra outlets that also sell Scorpio, Xylo, etc.. They will have separate showrooms and service centers too maybe. They are going to launch the facelifted LOGAN and sell it with it's own showroom. It will still be Mahindra-Renault though.

And I don't think a trim is going to happen. Because of all the engineering overhead involved and the re-certification by ARAI.

Hmm it does indicate that way! If this happens, it would be great! I am sure Renault alone will pull in more people than for example a Mahindra Renault! Also Dealer attitude would change as they wont have the Xylo to be sold against the Logan!

Here are Excerpts from the Autocar(A) Interview with Mr. Carlos Ghosn(CG), CEO Renault Worldwide.

A - What do you think went wrong with the Logan?
CG - Nothing went wrong with the car. What went wrong is the difference between our expectations and the level of sales in the market. We discovered that probably its too pricey for the segment we want to address. The Logan is a Low price car in Eastern Europe, North Africa and Russia. Its not in India

A - There are a lot of speculation about the MR JV. Since the JV is limited to a single product, L-90(Logan), which isnt successful, I'm curious to know how the JV will continue?
CG - I can understand your curiosity! We are also worried about this and we're talking to Mahindra about it . We are trying to fix the lower (sales) performance of the L90. Not absolute performance because consumers who have bought the car are very happy with it. But this does not mean that because we are in a relationship, its going to continue like this. No. we are going to come together to a conclusion about what would be the best way to develop the presence of Renault in India.

A - Are you willing to walk away from the JV with Mahindra?
CG - Well we need to know first what are the problems we are facing. If the solutions are compatible, we dont do it alone but we do it with our partners. We are in India to stay for a very long time and want to make sure that at least if we dont have partners, we keep friends.