France's Renault introduces low-cost Logan sedan in India with Indian company

France's Renault SA on Tuesday is introducing its low-cost Logan sedan in India through a joint venture with local automaker Mahindra & Mahindra, boosting competition in the fast growing Indian car market.

The base model of the gasoline-powered version of Logan will cost 428,000 rupees (US$9,700) in Mumbai, while that of the diesel version will be available for 547,000 rupees (US$12,400), said a statement from Mahindra Renault Ltd., a joint venture between the Indian and the French automakers.

Prices vary across Indian cities, depending on local taxes. The gasoline version comes with engines of 1.4 liters and 1.6 liters, while the diesel version has a 1.5-liter engine.

The pricing, which the manufacturer described as "aggressive", places Logan in competition with mid-size sedans from South Korean car maker Hyundai Motor Co., homegrown Tata Motors Ltd. and the country's largest car maker - the Suzuki Motor Inc.-controlled Maruti Udyog Ltd.

India's car market is dominated by small hatchbacks, but rapidly growing middle class incomes has fueled demand for low-cost sedans.

"The Logan is a milestone for us as it marks our entry into the most competitive segment of the automotive market," said Anand Mahindra, chief executive of Mahindra & Mahindra.

Orders will be taken for Logans in 10 Indian cities in two weeks and extend to another 15 cities in May, the statement said.

Tuesday's launch "marks the start of Renault sales on the Indian market and sees the first right-hand drive version of Logan created to meet the needs of our Indian customers," said Carlos Ghosn, president & CEO of Renault.

The French company has seen its profits surge because of the success of Logan, which is mostly made in Romania.

In India, the wide-bodied sedan will rolled out from a plant in the town of Nasik, which has capacity to manufacture 50,000 vehicles annually.

Mahindra Renault is also collaborating with Japan's Nissan Motor Co. - in which the French auto maker holds 44 percent stake - building a bigger plant near the southern Indian city of Chennai.

The three companies are together investing about US$900 million in that plant, which will be completed in the second half of 2009 and will have capacity to manufacture 400,000 vehicles, including the Logan.

Global automakers have been stepping up efforts to increase their presence in India, where the economy is growing close 9 percent annually and demand for cars is strong, thanks to rising middle class incomes and easier access to loans.

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Author`s name Angela Antonova
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