Henry
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MUMBAI: Japanese carmakers Nissan and Toyota have started exporting midsized cars made in India, spearheading a strategic change that seeks to make the most of the country's cost advantage and growing technical prowess.
In the next 12-18 months, Nissan plans to export 50,000 units of India-made sedan Sunny to the West, executives familiar with the matter said, adding that rival Toyota will ship Etios cars, made at its Indian unit, to South Africa.
Volkswagen, Ford and Renault are expected to join them soon. Experts say exports not only help in dealing with the slowdown in the domestic market, but also act as a hedge against costlier imports, which have turned dearer by 25-30% in recent months.
French carmaker Renault plans to export to the UK about 25,000 units of its sports utility vehicle Duster over 12-18 months. The shipments may start in October.
Similarly, Germany's Volkswagen is keen on producing left-hand drive Vento sedans in India for markets in the West. Volkswagen, which exports India-made Vento cars to South Africa and Malaysia, has mandated vendors to develop components for a left-hand drive version of the sedan.
The carmaker plans to export 8,000-10,000 such units by 2013, said an executive, who did not wish to be named.
"Our export of the Vento to South Africa confirms that we are able to produce high-quality cars in India at competitive costs," Volkswagen India's spokesperson said, adding, "This also shows our potential to further extend our exports to other markets. We are looking at various opportunities in the future, also in left-hand drive markets."
The Volkswagen spokesperson, however, declined comment on target markets and numbers.
Ford Motor, too, is likely to export its yet-to-be launched EcoSport SUV from India, according to people familiar with the company's plans.
Executives dealing with the projects of multinational carmakers say that over 100,000 sedans and SUVs manufactured in India are slated for export over the next 12 months. The depreciating rupee, which ended at a record low on Friday, is only likely to accelerate such plans.
Experts say the growth in exports, which comes at a time the global economy is slowing down, could accelerate once the economy picks up. There are not many right-hand drive manufacturing bases that are as cost competitive as India, said Kumar Kandaswami, director at Deloitte.
"The cost of engineering, both at the carmaker's end and supplier's level is very competitive, which gives India an edge. Manufacturers use exports as not only an opportunity to mitigate risk arising out of volatile currency, but even to balance the demand in the domestic market," said Kandaswami.
Toyota Kirloskar, the Indian subsidiary of the Japanese carmaker, has already received orders to export 20,000 units of the Etios sedan to South Africa. The company's deputy MD, marketing, Sandeep Singh, told ET the exports will help cut losses on account of the falling rupee.
Ford, too, is firming up plans to export its EcoSport SUV from India to South Africa next year.
After small cars, global auto companies like Nissan and Toyota start exporting sedans & SUVs from India - Economic Times
Japanese auto major Nissan Motor wants to become the largest car exporter from India, a senior executive said.
The second largest carmaker in Japan is also planning to make India the launch pad for its entry level low-cost brand Datsun.
Nissan is the fastest growing exporter of cars from India, in a country where South Korean Hyundai Motor and Maruti Suzuki India are now the leading car exporters. Nissan exports have doubled to 1,00,909 cars in the last fiscal driven by strong demand for compact cars from Europe and Latin American markets.
Nissan began to export cars in 2010 from Chennai and currently ships 85% of its production to overseas markets. Its wholly-owned Indian subsidiary, Nissan Motor India (NMIPL), has now started shipping its sedan model Nissan Sunny after the huge success of its 'made in India' Micra hatchback, which is now sold in over 100 countries.
It exports fully-built cars such as Micra from Chennai, its strategic production hub for Africa, Europe and other Western markets. The company has now started exporting completely knocked down kits of its sedan, Sunny, to Egypt. These kits from India would be assembled by the local Nissan subsidiary abroad.
Speaking to ET, NMIPL Managing Director Takayuki Ishida said: "We have ambitious plans for India. Exports from India have been a huge success so far, and we want to increase it with new models, as trans-continental markets post stronger demand for smaller cars. We plan to increase our production to over four lakh cars, most of which would be meant for exports."
Currently, the company produces three lakh units under the Renault-Nissan global alliance joint plant in Chennai. About 85% of the production is meant to be exported to markets in Europe, Asia and Africa. It eventually aims to pip South Korean carmaker Hyundai as the largest exporter from India, which has shipped 2.37 lakh last fiscal.
"We are readying several markets to increase export of cars manufactured in India. We will also expand our product portfolio by launching several new cars. Many of these would be targeting overseas market and India could be the sole production centre in Asia," Ishida said.
Analysts say that many car companies in India have great potential to tap overseas markets. "India enjoys tremendous advantages of cost competitiveness due to cheaper labour. The added advantage of huge volumes enjoyed by Hyundai and Maruti Suzuki allow them to export more and take competitive advantage in overseas market. Likewise, Nissan also has a huge product portfolio and eventually would become a major player in exports market," said a Mumbai-based auto analyst with a brokerage firm.
Nissan is currently developing a small car of Rs 2-4 lakh to take on models such as Maruti Suzuki Alto and Hyundai Eon. Its manufacturing plant at Oragadam in Chennai would make Datsun cars for local and export markets, even as the company is considering a new factory to manufacture the new low-cost brand.
Datsun, expected to be a high-volume product targeting emerging economies, is expected to roll out by mid-2014. "We are developing the car keeping in mind the needs of emerging markets such as India, Brazil and Russia. The production base here is expected to meet the overseas demand for Nissan cars," Ishida added.
Nissan to make India export hub - Economic Times
In the next 12-18 months, Nissan plans to export 50,000 units of India-made sedan Sunny to the West, executives familiar with the matter said, adding that rival Toyota will ship Etios cars, made at its Indian unit, to South Africa.
Volkswagen, Ford and Renault are expected to join them soon. Experts say exports not only help in dealing with the slowdown in the domestic market, but also act as a hedge against costlier imports, which have turned dearer by 25-30% in recent months.
French carmaker Renault plans to export to the UK about 25,000 units of its sports utility vehicle Duster over 12-18 months. The shipments may start in October.
Similarly, Germany's Volkswagen is keen on producing left-hand drive Vento sedans in India for markets in the West. Volkswagen, which exports India-made Vento cars to South Africa and Malaysia, has mandated vendors to develop components for a left-hand drive version of the sedan.
The carmaker plans to export 8,000-10,000 such units by 2013, said an executive, who did not wish to be named.
"Our export of the Vento to South Africa confirms that we are able to produce high-quality cars in India at competitive costs," Volkswagen India's spokesperson said, adding, "This also shows our potential to further extend our exports to other markets. We are looking at various opportunities in the future, also in left-hand drive markets."
The Volkswagen spokesperson, however, declined comment on target markets and numbers.
Ford Motor, too, is likely to export its yet-to-be launched EcoSport SUV from India, according to people familiar with the company's plans.
Executives dealing with the projects of multinational carmakers say that over 100,000 sedans and SUVs manufactured in India are slated for export over the next 12 months. The depreciating rupee, which ended at a record low on Friday, is only likely to accelerate such plans.
Experts say the growth in exports, which comes at a time the global economy is slowing down, could accelerate once the economy picks up. There are not many right-hand drive manufacturing bases that are as cost competitive as India, said Kumar Kandaswami, director at Deloitte.
"The cost of engineering, both at the carmaker's end and supplier's level is very competitive, which gives India an edge. Manufacturers use exports as not only an opportunity to mitigate risk arising out of volatile currency, but even to balance the demand in the domestic market," said Kandaswami.
Toyota Kirloskar, the Indian subsidiary of the Japanese carmaker, has already received orders to export 20,000 units of the Etios sedan to South Africa. The company's deputy MD, marketing, Sandeep Singh, told ET the exports will help cut losses on account of the falling rupee.
Ford, too, is firming up plans to export its EcoSport SUV from India to South Africa next year.
After small cars, global auto companies like Nissan and Toyota start exporting sedans & SUVs from India - Economic Times
Japanese auto major Nissan Motor wants to become the largest car exporter from India, a senior executive said.
The second largest carmaker in Japan is also planning to make India the launch pad for its entry level low-cost brand Datsun.
Nissan is the fastest growing exporter of cars from India, in a country where South Korean Hyundai Motor and Maruti Suzuki India are now the leading car exporters. Nissan exports have doubled to 1,00,909 cars in the last fiscal driven by strong demand for compact cars from Europe and Latin American markets.
Nissan began to export cars in 2010 from Chennai and currently ships 85% of its production to overseas markets. Its wholly-owned Indian subsidiary, Nissan Motor India (NMIPL), has now started shipping its sedan model Nissan Sunny after the huge success of its 'made in India' Micra hatchback, which is now sold in over 100 countries.
It exports fully-built cars such as Micra from Chennai, its strategic production hub for Africa, Europe and other Western markets. The company has now started exporting completely knocked down kits of its sedan, Sunny, to Egypt. These kits from India would be assembled by the local Nissan subsidiary abroad.
Speaking to ET, NMIPL Managing Director Takayuki Ishida said: "We have ambitious plans for India. Exports from India have been a huge success so far, and we want to increase it with new models, as trans-continental markets post stronger demand for smaller cars. We plan to increase our production to over four lakh cars, most of which would be meant for exports."
Currently, the company produces three lakh units under the Renault-Nissan global alliance joint plant in Chennai. About 85% of the production is meant to be exported to markets in Europe, Asia and Africa. It eventually aims to pip South Korean carmaker Hyundai as the largest exporter from India, which has shipped 2.37 lakh last fiscal.
"We are readying several markets to increase export of cars manufactured in India. We will also expand our product portfolio by launching several new cars. Many of these would be targeting overseas market and India could be the sole production centre in Asia," Ishida said.
Analysts say that many car companies in India have great potential to tap overseas markets. "India enjoys tremendous advantages of cost competitiveness due to cheaper labour. The added advantage of huge volumes enjoyed by Hyundai and Maruti Suzuki allow them to export more and take competitive advantage in overseas market. Likewise, Nissan also has a huge product portfolio and eventually would become a major player in exports market," said a Mumbai-based auto analyst with a brokerage firm.
Nissan is currently developing a small car of Rs 2-4 lakh to take on models such as Maruti Suzuki Alto and Hyundai Eon. Its manufacturing plant at Oragadam in Chennai would make Datsun cars for local and export markets, even as the company is considering a new factory to manufacture the new low-cost brand.
Datsun, expected to be a high-volume product targeting emerging economies, is expected to roll out by mid-2014. "We are developing the car keeping in mind the needs of emerging markets such as India, Brazil and Russia. The production base here is expected to meet the overseas demand for Nissan cars," Ishida added.
Nissan to make India export hub - Economic Times
