According to foreign media reports, people familiar with the matter recently revealed that Renault SA is looking for a partner in India and has launched preliminary negotiations with JSW Group, a subsidiary of Indian billionaire Sajjan Jindal, to explore the possibility of forming a potential joint venture to strengthen its market position in India.
JSW Group’s business covers the automotive, steel, energy and infrastructure sectors. The group previously held a 35% stake in rival MG Motor India Pvt. through a joint venture with China’s SAIC Motor Corporation.
Image credit: Renault Automobile
Currently, JSW Group is seeking to develop its electric passenger car business independently outside of MG’s joint venture project in India. Cooperation with a world-renowned automaker like Renault will significantly accelerate its strategic layout process.
Renault is expected to finalize its partnership plans in India after appointing a successor to outgoing CEO Luca de Meo. Previously, Luca de Meo played a key role in reshaping the profitability focus of Renault’s global business and streamlining operations, including driving operations in emerging markets such as India.
People familiar with the matter said that negotiations between Renault and JSW are still ongoing, and it is not yet certain whether cooperation will be reached.
A spokesperson for Renault India declined to comment on the report, and JSW Group did not respond to a request for comment.
The search for cooperation comes as Renault gradually weakens its long-standing alliance with Nissan. Renault, Nissan’s largest shareholder (36 percent), is currently in the final stages of acquiring a joint venture plant in Chennai, India. This is part of a broader agreement between Renault and Nissan announced in Paris in March this year, according to which the cross-shareholding ratio between Renault and Nissan will be reduced from the current 15% to 10% according to the strategic restructuring agreement reached between the two parties.
Renault’s acquisition of the Indian plant, which started production in 2010, may be completed in the next few weeks, according to people familiar with the matter.
In the fiscal year ended March 31 this year, Renault sold about 38,000 vehicles in India, accounting for less than 1% of total passenger car sales in India. Renault’s operations in India have historically adopted a joint venture model, initially with Mahindra & Mahindra Ltd., a local car company in India, and then with Nissan, indicating that Renault prefers to adopt a shared ownership approach in one of the most competitive automotive markets in the world.
India is a highly competitive market for most global automakers, but Renault has carved a niche for itself with affordable compact models such as the Kwid hatchback and Triber utility vehicle. The company also exports vehicles from its Indian plant to other markets in Africa and the Asia-Pacific region.
In April this year, Renault also opened its largest global design center outside France at a technology center outside Chennai, India.