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Bajaj-Renault deal to be limited to ultra low-cost car project

Written by sanju singh

Tuesday, 05 August 2008

06 August 2008; economictimes.indiatimes.com: Nandini Sen Gupta: NEW DELHI: Bajaj Auto has expressed disinterest in partnering the Nissan-Renault alliance in the mainstream car business. Bajaj Auto MD Rajiv Bajaj told ET that it was not an area he felt his company had any expertise in, hence the decision. So, the Bajaj-Renault-Nissan partnership will be limited to the ultra low-cost car project. Speaking to ET, Mr Bajaj said: “We are not interested in participating in the mainstream car market as we do not believe that we can bring sustainable value to bear upon an existing auto major.” That’s the reason why, he said, Bajaj is not interested in expanding its partnership with Nissan-Renault beyond the ultra low-cost car project. Last week, ET reported that Renault had initiated talks with Bajaj to extend their partnership to cover the greenfield plant in Chennai (that will manufacture Renault and Nissan cars) as well as the marketing and distribution of Renault cars made in the plant. This, even as Renault is negotiating with Logan project partner Mahindra & Mahindra for a wider distribution arrangement. M&M pulled out of the Chennai plant in January this year. While Renault has officially denied it is in talks with Bajaj Auto to partner in the Chennai project, two persons familiar with the development confirmed to ET that Renault had made overtures to Bajaj for car distribution should the talks with M&M fail and had offered it a stake in the company that is setting up the manufacturing plant in Chennai.