The proposed alliance between Renault and Mahindra & Mahindra took the neutral position and yet to kick off, due to lack of funds. The companies are partnering under the banner Renault India and Mahindra & Mahindra (MRPL) to make and sell Logan sedan. For months together there has been no green signal recover the brand image, except negotiations between them. Main factors that contributed for the hassle are recession and fund lock. The car is the lone brand under the JV, the pressure is mounting on the early recovery.
The company has analysed the cost factor as the main one for the downfall of the sales. It costs more(Rs4.2 lakh-Rs7 lakhs) than Swift Dzire, Tata Indigo and Ford Ikon sedans. Further, the technical flaws like the wiper on the left for the right hand drive too brought the rejection. M&M has been offering the marketing back up through its 100 dealers. While there is no final word about the depart of the partners, both companies are conscious of the investment made so far. Renault is in tie –up with Nissan on 50:50 basis to make cars at the Chennai plant; with Rs200 crore being diverted to the Nashik plant. Thus the investment may accrue to Rs1000crore for Renault alone.
Even if the companies break apart, Renault would have a large say and same is the case with M&M too. Amidst these speculations, the companies are burning the midnight candle on promoting more sedan variants- Sandero, a hatchback on Logan platform. In addition, M&M would make its own products in Nashik plant. Everything is on paper and air, but for the outcome we have to wait further.