Bajaj, Renault Nissan to launch small car by 2011

Pune: The ‘ultra low cost’ car of the Bajaj Renault Nissan combine, which will compete with Tata’s Rs 1-lakh car, will be on the road by 2011, partners of the joint venture announced.

Code named ‘ULC’ (ultra low cost), the small car will be made at a new plant at Chakan in Maharashtra, with an initial annual capacity of four lakh units.

Bajaj Auto will hold 50 per cent stake in the joint venture while both Renault and Nissan will hold 25 per cent each, a press release issued jointly by the partners said. The partners were unwilling to divulge investment details. However, the initial investment is expected to be around Rs 1,000 crore.

The ‘wholesale’ price range of the car will start from invest $2,500 (Rs 1.05 lakh), said the release. However, Nissan’s spokesperson said the ‘retail’ price may be higher.

“We are targeting a very competitive price. From now to 2011, the price may change with the integration of new regulations such as Euro 4 emission regulations and macroeconomic evolutions such as steel and other raw material prices,” Mr Simon Sproule, Vice-President, Global Communications, Nissan Motor Company, said.

Tatas plan to launch the low-cost Nano by end of this year.

“We face competition in every segment all around the world. A good product can take on competition,” said Mr Sproule said when asked how ‘Lite’ will face the competition from Nano. “We will compete with Tata Nano and other potential newcomers,” he said.

The MoU for the joint venture will be signed by June. The ULC will be made for both domestic and export markets, said Mr S. Ravikumar, Vice-President, Business Development, Bajaj Auto. The car might look completely different from the concept ‘Lite’ that was unveiled at the Auto Expo, he said.