CHENNAI, India, Feb 26, 2007 (AFP) – Japanese automaker Nissan on Monday tied up with French partner Renault’s Indian venture to build a 902 million dollar plant, joining a race with rivals Toyota and Honda for a slice of the South Asian nation’s expanding car market. For decades after independence India’s roads were dominated by two ancient models, the Premier Padmini and the Ambassador, produced with technonology dating back to the 1950s. Indian parterner Mahindra and Mahindra will control 50 percent of the venture, with Nissan and Renault sharing the remainder, the three companies said in a joint statement.
The southern city of Chennai, known as India’s Detroit, was chosen as the site of the factory, which will have the capacity to turn out 400,000 cars a year seven years after the start of production in 2009.
Nissan and Renault are latecomers to the Indian car market, which is forecast to expand 10 percent a year to reach two million units in 2010 as an economy expanding nine percent a year boosts the buying power of consumers in the world’s second-most populous nation.
“With income levels rising, upward mobility is increasing,” said K.K. Mittal, a New Delhi-based fund manager at Escorts Asset Management who holds Mahindra shares in his 1.5-billion-ru