M&M defers plan for Chennai plant investment

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Car maker Mahindra & Mahindra on Tuesday said it has deferred its plan to invest, jointly with Renault and Nissan, in a manufacturing plant in Chennai.

“The company has reviewed its plans, while Renault and Nissan continue to be fully committed to their industrial development plans,” Mahindra & Mahindra informed the BSE.

In February last year, the company along with Renault and Nissan had announced its intention to set up a manufacturing facility at Orgadam, outside Chennai and signed a Memorandum of Understanding with the Tamil Nadu government.

The company would now utilise capacity available at its new plant in Chakan and other existing plants to meet its medium term requirements and hence not participate in the joint plant at Oragadam, M&M said in a communique.

It would continue its Mahindra Research Valley (MRV) at Chengelpet and tractor plant plans in Oragadam.

M&M would simultaneously evaluate a new automotive plant at Oragadam to further enhance its capacity. The Chakan plant owned by the company would manufacture Mahindra as well as Mahindra international truck products, it said.

However, Renault and Nissan maintain their development plans for the creation of a new industrial plant in Chennai.

They maintain their long term commitment to India, with local development including design, engineering and manufacturing.

Besides, Mahindra and Renault continue to have a strong relationship through their existing joint venture Mahindra Renault Pvt Ltd (MRPL) that has launched the Logan in India.

As of December 31, the Logan has captured a market share of 11 per cent in the C segment since the launch in May, thus becoming third in the segment, it added.