Nissan to make India a hub for manufacturing small cars

After Maruti, Hyundai and Ford, Nissan is the latest manufacturer to have declared India as a hub for making compact cars. Nissan certainly seems to have discovered India’s inherent strength in manufacturing cost-effective and quality compact cars. “India’s strength in manufacturing world class compact cars and its cost-effectiveness in the production process, will help the country to be the hub of small cars for Japanese car major Nissan,” feels the company’s global COO Toshiyuki Shiga.

Shiga forecasts that the core car markets would shift from the Western countries to the BRIC countries in the coming decade. “The car market is shifting from Japan, US and Europe where growth will be difficult to come by, even though the overall market may not be down. We have to adapt to this change,” Shiga told TOI in an interview. He added that Rs 2000 crore had already been invested by Nissan for its Oragadam plant which is shared with alliance partner Renault. Nissan’s compact car, the Micra’s launch is around the corner (read July) in India. The Micra, that would be the company’s volume driver in India, would also be the car that Nissan would sell in European and other key export markets.

Nissan will not stop with the Micra. To achieve success in India, Nissan will position various models at different price points from the Nissan badge ULC to the 2.5 lakh car (US$ 5,000) that it is developing with the help of Ashok Leyland. While the ULC might make it to showrooms in 2012, the 2.5 lakh car might hit showrooms sometime in end-2013. Nissan had earlier made Thailand a hub for manufacturing pick-up trucks and next in its list is making India an export hub for small cars. “There are a host of benefits that we get from India for compact cars. The investments are low here and the cost of labour and parts is cheaper than Europe. Importantly, there is a domestic market for such cars that gives us the scale to go for large numbers,” he said.

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