French car manufacturer Renault's Indian wing plans to discontinue the vehicles that are imported to the country in a semi-knocked down (SKD) from to increase its local products in India.
Renault aims to put in at least 80 percent local products in the big car segment to reduce price and boost sales volume. The strategy is to produce cars suitable for Indian conditions with locally sourced parts to keep the price in check.
The industry experts feel that this strategy will work for the company, as the Renault's Koleos and Fluence did not perform well in the market because of its inappropriate pricing. Both the models were imported in SKD form.
Chief Executive, Renault India, Sumit Sawhney, in an interview with ETAuto said, "We will selling only mainstream products. Fluence and Koleos were bridge strategy products, but as we move towards higher localization, we will try to be a more mainstream company."
It is believed that Renault will temporarily stop selling Koleos and Fluence models in India. Sawhney added, "We will not sell these cars until we have 80% local content."
With the success of its small car, the Kwid, Renault claims that it has achieved around 98 percent localisation in the country. The Kwid has been in the top ten selling passenger cars list since July 2016.
The Renault India is in the seventh position in Renault's global market in terms of sales volume from January to August 2016. This is mainly because of its entry-level car, the Kwid.
Sawhney aims to make India among the top five market for Renault. Currently France, Italy and Germany remain as the top three markets for the French firm. According to sources, Renault has an aggressive strategy with local suppliers to meets its localisation plan.
Renault plans to launch a new product every year in the Indian market over the course of next five years starting from next year. The company will be launching a compact SUV to take on the likes of Maruti Suzuki Vitara Brezza and Ford EcoSport.
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