Renault-Nissan, the Franco-Japanese automotive alliance will invest USD 320 million to set up a second plant in India, according to media reports.
The two companies will set up their second plant with an annual capacity of 2,00,000 units in Chennai, where it already has a unit, entailing an investment of 30 billion yen (USD 320 million), as per media reports quoting Japanese business daily Nikkei.
When contacted, a Nissan spokesperson said: "We are considering the possibility of producing an entry-level model at the Renault-Nissan Alliance plant in Chennai, but we cannot go into any further detail."
According to the reports, the new plant will produce Nissan's Datsun brand along with other low cost models from Renault that are under development.
Nissan has already announced that to achieve its goal to have 8 per cent market share globally, it will launch 10 new models, including the Datsun brand, in India by 2016. The Datsun brand will make its re-entry to the market by FY14, with two products from the range to be launched in India, Indonesia and Russia and another one to follow in three years after these have been launched.
Renault has also been aggressively expanding in India. Last year, it completed the launch of a series of five models Ė Fluence, Koleos, Pulse, Scala and Duster Ė which it had announced in 2010.
The Renault-Nissan alliance had invested Rs 4,500 crore to set up their first manufacturing plant at Oragadam, near Chennai with a total capacity of producing four lakh units per annum.