Renault to Exit Joint Venture with Mahindra and Mahindra

Saturday 17 April 2010, 00:00 AM by Payal Pathak

Renault and M&M had formed a joint venture in India and had introduced Mahindra Renault Logan in the Indian market. The model had given disappointing sales figure to the new joint venture company. Moreover, M&M and Renault had growing tiffs between them since past one year. Now Renault has announced that it will quit the joint venture, a development which marks the end of months of differences between the two companies.

Renault will continue to support M&M with license agreement and supplying key components for its product Logan in India. The license agreement will be solely for Logan models only and not other models built on the same platform. Renault has been planning to introduce Sandero in the Indian market which will be built on Logan platform.

Renault will sell its 49 percent stake in Mahindra Renault Pvt. Ltd and Mahindra and Mahindra will own the company. MRPL will become a 100 percent owned subsidiary company. "The new agreement between Mahindra and Renault will give us the opportunity to chart out a new strategy to help drive the Logan brand in India, which will also include engineering changes, keeping in with customer requirements," M&M President Automotive Pawan Goenka said. M&M will continue to sell Logan in India for next coming months but after 18 months the car will be renamed and will sport only Mahindra logo.

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