Many Joint Ventures (JVs) have taken place in the Indian automotive sector during the past. Some of these ventures are: Hindustan Motors (HM) - Mitsubishi, Bajaj-Renault, Ashok Leyland (Ashok Motors and Leyland Motors) and Mahindra Ford. However, not all of them were successful and some had to bite the duct within a few months.
Mahindra & Mahindra (M&M) had entered into a 51:49 venture with Renault India, for the manufacture of its first product, the Logan, which was a sedan. A state-of-the-art manufacturing plant was set up in Nashik, Maharashtra by the two manufacturers, for building the Logan. However, the alliance was only able to roll out a single vehicle, despite plans for making many more, as the JV (Joint Venture) ended in 2010.
One of the reasons for breaking this alliance was the low sales of the Logan, which were largely due to its high price of Rs. 7.50 lakhs (on road Mumbai). This was because of the 20 per cent excise duty on the vehicle, which was longer than 4 metres. The boxy look of the vehicle, along with wrongly placed power windows lock switches and windscreen wipers that move from right to left are some of the factors that contributed to the downfall of the Logan. Additionally, it did not get any ABS (Anti Lock Braking System) with EBD (Electronic Brakeforce Distribution) at this price.
The JV between M&M and Renault took place in 2005, and ended in 2010. M&M's demand to reduce Logan's length of 4,247 mm was turned down by Renault, which was not keen on modifying a set global platform. M&M also wanted greater control in the department of product re-engineering.
Despite the Logan doing well worldwide, its sales continued to slump in India, as is seen by the sales of September 2009, which was just over 500 units. In markets such as Central and Eastern Europe, Turkey and North Africa, it was launched as a 5000 pounds global low-cost car, and is selling well. Currently the Logan is being built at different plants such as Tehran, Moscow, Curitiba (Brazil) and Envigado (Colombia). Some of the advantages of this vehicle that have also been confirmed in India are its large boot and high fuel efficiency. It was also endowed with a high ground clearance, for swallowing the potholes on Indian roads with ease.
By April 2010, M&M bought over the 49 per cent stake of Renault India, to produce the new Mahindra Verito, which was the revamped version of Logan. The name was changed, and many new cosmetic changes were made to the vehicle. However, the rights to retain Renault petrol and diesel engines were granted to M&M, and a face-lifted version of Logan, christened as the Verito, was launched on 26th April 2012.
Today, Renault without any domestic support is doing very well in India, especially with its new compact SUV, the Duster. This vehicle managed to generate over 15,000 bookings in the first two months of its launch. Indian customers have finally taken a liking to the styling from this French auto maker.
An alliance between Hindustan Motors (HM) and Mitsubishi Motor Corporation (MMC) took place in 1998, to bring the legendary Japanese auto manufacturer into India. The Japanese manufacturer had to discontinue the Lancer last month, as many upgrades such as the Lancer Evolution, in keeping with the times, could not be launched in India. As the obsolete model of the saloon was kept in the domestic market, buyers showed a declining level of interest in purchasing the Lancer. The Pajero SFX was discontinued due to intense competition from Ford Endeavour, Toyota Fortuner and others, and also had obsolete levels of interior and exterior design.
Being a world leader in saloons and SUVs, there is no reason for the marque to not succeed in India. It could may as well be the lacklustre nature of HM, which is preventing Mitsubishi from making intelligent choices. As of now, Mitsubishi says that it wishes to continue to specialize in the SUV market only, and also does not plan to launch the Mirage here, which is a well known hatchback in the world. One may just see MMC being revived, if the company decides to venture out on its own, in a manner similar to Renault.
