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Rediff News  All News  » Business » Nissan's Indian component sourcing to rise four-fold in 2 yrs

Nissan's Indian component sourcing to rise four-fold in 2 yrs

Last updated on: November 26, 2010 10:53 IST
NissanNissan Motor Ltd of Japan is looking at a four-fold increase in sourcing of production components from India for its global operations.

The company would import $10 million (Rs 45 crore) of components in 2010 from Indian vendors. It is set to increase this to $40 million by the end of 2012, a top company official said.

"We are presently exporting various parts from India for Nissan's global manufacturing facilities in Thailand, China and Japan.

"Presently, we are exporting components for our global compact car, Micra. Going forward, we will be exporting components for other models as well," Kiminobu Tokuyama, managing director & CEO, Nissan Motor India Pvt Ltd, told Business Standard.

NMIPL, a fully-owned subsidiary of Nissan Motor Ltd, Japan, which launched the petrol version of the Micra in July, is sourcing 85 per cent of the components from Indian vendors. Of this, half are sourced from vendors in and around Chennai, he said.

However, Nissan imports some components, such as the transmission and safety features, from various countries.

The company is currently in talks with Indian vendors for supply of some key components that go into transmission units, said Gary Kirby, assistant chief vehicle engineer of small cars at the Nissan R&D Centre in India.

He said Nissan was studying the possibilities of producing transmission products in India. "We have a comprehensive plan to manufacture these components in India and are talking to Indian vendors to source some of the key components like cylinder heads and blocks. In
the next three to five years, these components will be manufactured in India," Kirby said.

In February 2008, Nissan and its global alliance partner, Renault, signed an agreement with the government of Tamil Nadu to set up a manufacturing unit at Oragadam, near this city, with an investment of Rs 4,500 crore (Rs 45 billion) over seven years.

The factory was inaugurated this March, with an initial capacity of 200,000 units per year.

It is to reach 400,000 units yearly in due course.

Tokuyama said another Rs 2,200 crore (Rs 22 billion) would be invested in the next two to three years to set up one more assembly line and introduce six other models.

The company plans to launch its new sedan on the 'V' platform towards the end of 2011. This model would be launched in China and America before India, he said.

He said the company was also studying the possibility of launching a new car, positioned below the Micra and above the ultra-low cost car it was working on.

"There is a growing demand for small cars in India and Nissan has studied the segment and the concept is in the initial development stage," he said.

Nissan plans to roll out three new vehicles, including a bus-truck and a multi-purpose vehicle, through its joint venture with Ashok Leyland in the first half of next year.

Mahesh Kulkarni in Bengaluru