Nissan to launch auto production in India

Nissan is considering two or three coastal cities in western and southern India as possible locations and plans to negotiate with local governments before making a decision, which could come as early as this month, the Nikkei business daily said.

Construction on a main assembly plant will begin this year, the business daily said, adding that Nissan expected to launch operations in the latter half of 2009 with an annual output capacity of around 200,000 units.

With about 10 auto parts manufacturers that supply Nissan also slated to start local production in India in line with the move, the group's overall investment is expected to total 100 billion yen (US$840 million), it said.

The factory will turn out one-litre-class subcompacts, the daily said.

Some 30 percent of the vehicles will be sold in India with the remaining 70 percent to be exported to Europe and other markets.

The number of models produced will be gradually expanded, with plans to eventually bring total output to around 400,000 units, it said.

Nissan, which currently only exports some 200 vehicles to India from Japan a year, will work on developing a dealership network and eventually open about 100 branches in major urban areas by 2010, the Nikkei said.

Nissan's top shareholder Renault SA has separately drawn up plans to jointly produce vehicles with midsize Indian automaker Mahindra and Mahindra Ltd. in India.

Credits: ifconfig