Renault coming to Gujarat?

The story which started with Tata Motors continues with reports that the French automaker, Renault, is thinking of setting up a manufacturing plant in Gujarat. If sources in industry and the Gujarat government are to be believed, Renault is scouting for 400 acres of land in the state.

Around 7.70 lakh cars are expected to be produced in Gujarat by 2014. But if Renault actually sets up a manufacturing unit in the state, the number of cars produced in Gujarat by 2014 is likely to increase to 9.70 lakh cars per annum. The French car-maker is believed to be considering setting up a 2 lakh unit small car plant in the state. After Peugeot, this will be the second French automaker to set up a manufacturing facility in Gujarat.

A Forbes India’s report has stated that the Renault-Nissan alliance is aiming for a manufacturing capacity of about 4 lakh units for its small car program. “This will be in addition to the alliance’s current manufacturing capacity at its Chennai plant (2 lakh units which can go up to 4 lakh). Over the last few months, Renault has been scouting for about 400 acres of land in Gujarat,” the report states.

With four major car manufactures in Gujarat, the automobile industry has so far invested Rs11,800 crore in developing facilities in the state. At present, General Motors and Tata Motors together produce around 3.60 lakh cars a year.  

With the commitment of Ford and Peugeot, the total car manufacturing capacity of Gujarat is expected to rise to 7.70 lakh cars per annum by 2014. If Renault too enters the state to produce 2 lakh cars, the total car production capacity in the state may go up to 9.70 lakh units per annum. Ford signed a contract with the state government in June 2011 and Peugeot in September 2011.

Both the car makers have announced investment of Rs4,000 crore each. Ford will commence production at its plant by 2014 with a capacity of 2.40 lakh units per annum while Peugeot wants to start its plant in 2013 with an initial capacity of 1.70 lakh units. This can later be increased to more than 3.40 lakh units per year.

Officials of Renault were not available for comment. When asked whether Renault was coming to Gujarat, minister of state for industry Saurabh Patel neither denied nor confirmed the development. "No comments. I can't say anything as I am in Bhavnagar at present," he said.