‘Renault.Rethinks’, a game plan for growth and addressing growing demand

Could you share an update on Renault’s plans to takeover the Chennai factory from alliance partner Nissan and what it means for your India strategy?

First and foremost, this is a project we’ve taken over from a technical standpoint. As of now, Renault’s intention to take full ownership of the Oragadam plant has been announced and stands confirmed. Discussions are currently ongoing between the alliance partners, and we expect the transition process to conclude within the next two to three months. Once finalised, the necessary alignments and actions will follow to set the course for the next phase of operations. At this point, it’s difficult to offer precise short-term details. However, one thing is clear: at both the global and local levels, Indian market represents a major growth opportunity for us and Renault is here in India for the long haul, with firm plans to grow and lead..

What strategic advantage does Renault gain by acquiring full control of the Chennai plant?

The plant currently has a capacity of around 472,000 to 480,000 units annually. To fully leverage this, our focus is on scaling domestic volumes, supported by exports. We’ve committed ₹5,400 crore toward future product development, including B-segment vehicles, compact SUVs (CSUVs), and electric vehicles (EVs). About 90 per cent of the groundwork is already complete. These upcoming products are expected to significantly boost our volumes. Importantly, the plant will continue to manufacture both Renault and Nissan vehicles. This collaboration allows us to potentially double our current output. By early 2027, we aim to reach a production volume of 280,000 to 300,000 units, and eventually utilise the plant’s full capacity by 2030. The goal is 100 per cent utilisation, with room for future expansion.

While Renault hasn’t faced the same challenges in India as your alliance partner, growth has still been relatively measured—some might say the brand wasn’t as aggressive in its approach. What gives you the confidence now to pursue ambitious volume targets?

That’s a fair observation. When Luca de Meo took over as global CEO in 2021, Renault was in a tough spot — not just in Europe, but globally. The Ukraine conflict forced us to shut down three major plants in Russia. We were already underperforming in China and eventually exited that market. Brazil also lagged, and we didn’t have a US presence. That left India — which, at the time, wasn’t profitable.

Most of our Indian portfolio was priced under ₹10 lakh, resulting in tight margins. Running a 480,000-unit plant with such limited scale and low reinvestment was challenging.

The turnaround came with the launch of the Renaulution strategy in 2021. It helped Renault regain profitability in Europe and laid the foundation for international growth. Brazil and Korea have since shown strong performance. Now, it’s India’s turn.

Our global CEO has visited India twice in the past year—a strong signal of commitment. He’s set clear expectations, and now it’s up to the India team to deliver.

Yes, our earlier approach here was inconsistent, with long gaps between launches. External events like Covid and the Ukraine war affected momentum. But now, the scenario has shifted. India is a strategic growth market for us. Taking 100 per cent ownership of the Chennai plant is a strong and symbolic step toward that future.

What are your sales and market share growth ambitions under the new strategy?

As of March 2024, the Total Industry Volume (TIV) in India stood at 4.3 million passenger vehicles. Forecasts indicate this could grow to 6.2–6.4 million by 2030. Personally, I believe the market could reach close to 10 million by 2032, driven by a rapidly evolving ecosystem and increased development momentum. This anticipated growth reinforces our decision to fully acquire the plant. It’s a bold, forward-looking move that positions us to better address the growing demand. Our target is to secure at least a 5 per cent share of a 10-million-unit market, which justifies the scale of our investment.

How are Renault’s upcoming product launches shaping up under the new strategy?

One of the cornerstones of our strategy is Renault.Rethink — a fresh approach to engaging customers and redefining how they perceive the brand. As part of this, Renault will launch five new models over the next two years, with the first expected to arrive in just a few months.

Our upcoming B+ and C-segment SUVs will be foundational to the next phase of our growth. These are all-new products — not just next-gen versions of existing models. At the same time, our current line-up will also evolve into its next-generation avatars.

And we’re not stopping there. Discussions for the next wave of products are already underway, and we’ll share more once those plans are finalised. What’s critical is that this time, we are fully committed to execution.

We’re no longer limiting ourselves to the sub-₹10 lakh segment. Our product strategy now spans the CMFA platform and the A, B, and C segments — each addressing different price points and supporting a more diversified revenue model.

SUVs remain central to our approach. We aim to compete across the entire spectrum — from entry-level to premium. The B+ and C-segment SUVs are already in development and on track for launch before 2027.

In addition, we’ve introduced a new brand identity that’s being rolled out across our entire dealer network under a unified retail concept we call RStore.