Nissan plans compact car segment entry

Nissan Motors India Ltd on Thursday said that it would be entering into the compact car segment to maintain a strong position in the domestic market.

"To begin with, we would position ourselves as a luxury brand. But as we seek to become a dominant player, we will have to enter the compact car segment to be competitive in the Indian market. We are very keen to enter the volume and low price segment,'' said Ms Yoshie Motohiro, Managing Director, Nissan Motors India Pvt Ltd during the launch of its luxury car — Teana — in the domestic market.

At present, Teana will be imported from its manufacturing facility in Japan. However, as the production kickstarts under its joint agreement with Renault and Mahindra by the second half of 2009, Teana would be manufactured from its Chennai facility.

Priced at Rs 20.47 lakh at its showrooms in Delhi, Bangalore, Hyderabad, and Chennai, it would cost a little more — Rs 20.67 lakh — in Mumbai. The company would decide on expanding its dealer base network depending on the volumes and the customer response, said Ms Motohiro.

Nissan is targeting to sell 350 units of Tiana this year. The vehicle is powered by a 2.3-litre petrol engine.

The company, which entered into the Indian market with the introduction of the SUV X trail, sold 250 units last year and is targeting to sell another 250 in the current year.

Nissan Motors, which has two more years before actual production starts, would utilise the time to better its understanding of the Indian market and the models that it would manufacture from its Chennai facility.

With high duty on imported cars, Nissan will have to consider manufacturing in India to enter into the compact car segment, she said. ``Besides products from the Chennai plant, we are even looking at introducing the small car model, which we will be sourcing from Suzuki, in the Indian market. We have two more years before production begins at the Chennai plant, and during this period, we will work on the product portfolio,'' she said.

Independent network

However, Ms Motohiro said that despite an agreement with Renault and Mahindra, the Japanese major would pursue an independent sales and dealer network for its products.

While the company had initially considered Chennai for its production due to its proximity to the port, she said that as per the current plan, the company was focussing on the domestic market. However, it was evaluating options for the export market.