Japan automaker, Nissan to launch Magnite, compact SUV to revive demand in India

Unveiled this month and due to be launched either late this year or early 2021, the Magnite will be Nissan’s first new vehicle in India in two years. Moreover, it will be just one of three Nissan-branded models in the market after two others were pulled in April when tougher emission rules kicked in.

Nissan Motor Co Ltd has had a dreadful run in India. A push to revive its lower-end Datsun brand flopped, sales have slumped 60% over the past five years and its sole plant in the country is operating way below capacity.

But the amount of money and energy that Nissan – battered by scandal and expecting a record $4.5 billion annual operating loss – will spend to turn its fortunes around in India will hinge on the sales of one vehicle, its new Magnite compact SUV, three sources with knowledge of the matter told Reuters.

Unveiled this month and due to be launched either late this year or early 2021, the Magnite will be Nissan’s first new vehicle in India in two years. Moreover, it will be just one of three Nissan-branded models in the market after two others were pulled in April when tougher emission rules kicked in.

Magnite will buy Nissan a couple of years to figure out a plan for India and the SUV’s success will determine whether it invests more or scales down operations,” said one source.

Japan‘s No. 2 automaker has, however, no plans to withdraw from India, where it has invested over $800 million, and discussions about strategy are ongoing, the sources said.

Nissan said in a statement to Reuters it is committed to the Indian market and has a well-defined strategy for “a sustainable and profitable business”. Nissan’s internal plans call for sales of 1,500 to 2,000 Magnites a month, the first source said – which if realised would exceed the average India monthly sales it achieved last business year with seven models.

The SUV will be priced “aggressively“, the sources said without elaborating. Originally developed as a Datsun model, it is now expected to have features typically seen in a mid-range car, including a touchscreen and cruise control.

But the market is difficult – demand has been pummelled by the coronavirus pandemic and India’s compact SUV segment is crowded. The Magnite will also go head to head with models from industry leaders – Maruti Suzuki’s Brezza and Hyundai Motor’s Venue.

India represents a particularly thorny market for Nissan as sales outlets have almost halved in number from around 270 in 2018 as dealers backed off to Renault drastically restructure in the wake of former leader Carlos Ghosn’s shock 2018 arrest and ouster.

Nissan is taking the lead in the United States, China and Japan. But India is the sole major market where no such decision has been made, with the automakers saying they will coexist and compete.

On one hand, Nissan has less than 1% of the India market, selling just 18,000 vehicles in the last fiscal year. But Nissan holds 70% of their jointly owned plant in the southern city of Chennai and exported 80,000 vehicles from the plant in the last business year, five times more than Renault.

 

Source: Reuters

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