This is how Renault plans profitability in India with new initiatives

  • The auto maker is also gearing up to bring a mass segment EV in India within the next two years.
The logo of French carmaker Renault is seen before the company's 2019 annual results presentation at their headquarters in Boulogne-Billancourt, near Paris, France, February 14, 2020. REUTERS/Gonzalo Fuentes (REUTERS)
The logo of French carmaker Renault is seen before the company's 2019 annual results presentation at their headquarters in Boulogne-Billancourt, near Paris, France, February 14, 2020. REUTERS/Gonzalo Fuentes

French auto major Renault is planning a slew of measures, including introduction of new models and expansion of sales network in rural areas, to ramp up operations in India and move towards a profitable business set up in the country.

The company, which is present in the country for over 8 years now with a market share of less than 3 per cent, aims to bring in products in the fast selling segments to shore up volumes and enhance market share in the 3 million strong Indian passenger vehicle segment.

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"The major strategy to gain market share in the country is to strengthen sales in the rural areas. We are occupying good space there already," Renault India Operations Country CEO and MD Venkatram Mamillapalle told PTI.

He was replying to a query on the measures the company was planning take to ensure steady growth in India.

Elaborating on steps being taken to enhance presence in smaller towns, Mamillapalle said the company is taking various initiatives, including taking care of service needs in such areas by having mobile workshops.

"Last year alone, we have opened 215 workshop on wheels, a concept where a vehicle (Lodgy) goes to rural locations and serves customers.This year we plan to take the number of such vehicles to 550," he added.

This is in addition to the regular sales network expansion, which the company does on a regular basis, Mamillapalle said.

"We want to scale up the sales network to 700 dealerships in the next fiscal from around 350 outlets currently. Also, there will be 550 workshop on wheels," he added.

On product strategy, he said Renault plans to focus on the sub-four meter segment to shore up volumes in India.

"We will bring innovation and find slots where demand is there. We have Kwid and Triber and in the second half of this year, we also plan to bring in a new product which would be based on Triber platform," Mamillapalle said.

With the entry-level and sub-four meter strengthened, the company aims to gain market share going ahead, he added.

"If the market remains the way it is today, I believe we should enhance our volume by at least by 10 per cent as compared to 88,864 units in 2019," Mamillapalle said.

Above sub-four meters, Renault already has products like Duster and Captur in its portfolio to cater to different set of customers, he added.

The company also plans to bring in new version of Duster, but did not share timeframe for it.

Mamillapalle said the company will also take steps to enhance sales of its entry level hatchback Kwid from around 4,000 units a month currently to around 6,000 units going ahead.

The auto maker is also gearing up to bring a mass segment EV in India within the next two years, he added.

The company is taking steps to remove some of the legacy products from its portfolio which have not done well in terms of sales.

"Moving in this direction, we have already discontinued Lodgy from December," Mamillapalle said.

With a new product coming later this year in the volume segment, the company also expects the condition of its dealer partners to become better.

When asked if all these measures would help the company move towards profitability in India, Mamillapalle said: "Off course, that is the whole objective".

On timeframe to achieve a turnaround in the business, he said: "Let's see. I cannot predict that so fast but if this (all the measures being taken) happens, probably next year we should be profitable".

First Published Date: 14 Feb 2020, 18:35 PM IST
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