Nissan, one of the three largest car makers in Japan, is planning to develop a compact car made fully in India. The company's Indian subsidiary, Nissan Motor India, is rapidly strengthening its research and development (R&D) wing for the purpose.
International companies such as Toyota and Ford, and domestic market leader Maruti Suzuki have already done this with products developed majorly in India. Work on models such as the Etios, Etios Liva, Figo and Ertiga, respectively, was carried out in the country, keeping Indian consumers in mind.
Takayuki Ishida, managing director and chief executive, Nissan Motor India, said, "We have already recruited 3,000 people for the R&D centre. And, some of the people are developing that vehicle for us along with Nissan's technical centre. Their current capability allows them to develop some parts of the vehicle. They are able to do minor changes in the car now. Gradually, their capabilities will increase."
Nissan's entry-level car in India at present is the premium hatchback Micra priced Rs 4.21 lakh (ex-showroom Delhi). The company has six products on offer, including three fully imported models.
Earlier this year, Nissan announced the introduction of a new brand Datsun in 2014. It would be a low-cost brand serving customers in the Rs 2-4 lakh price band. Nissan will remain a relatively premium brand in India.
"I can't speak specifically on this but in the next four to five years when the R&D capability dramatically improves, I think we have an opportunity (to make that car). We can expect some development from the R&D team, using India's knowledge, for a compact product. At the moment, we have not completed the studies about it but, potentially, I think we have a good opportunity," added Ishida.
Products developed in India have proved to be best-sellers not just in India but in foreign markets as well. The Etios from Toyota Kirloskar Motor, for instance, is on target to sell 20,000 units in South Africa by the year-end even as the company prepares to begin shipments to Brazil.
Similarly, Ford Figo, the entry-level hatchback made in Chennai is shipped to South Africa, north Africa and Mexico among 50 foreign markets. Ford, the US-based car maker which has manufacturing facilities in several parts of the globe, makes the Figo only in India.
Nissan is eyeing similar success with the new small car. The Japanese company, which currently exports two-thirds of its production from India, is also talking about making India a larger base for production and export.
"We have a good opportunity to make India the manufacturing base. We need to think about growing the Indian market, how we can satisfy India's growing demand and even outside demand from India," added Ishida.
Ishida said both Renault and Nissan, which use each other's technology for car production and model selection, could also utilise R&D resources for the new compact car in the future.
It is, however, not clear if the new car would be sold under the Nissan or the Datsun badge.