For Carlos Ghosn, the high-profile, globe-trotting chairman and chief executive of the Renault-Nissan alliance, India is not only the potential destination to drive the alliance?s future growth, but also the place to learn its unique ?frugal engineering and product development? capabilities in order to conquer the emerging markets.

His penchant for ?frugal engineering? was more evident the other day when FE questioned the alliance?s logic in having more than one partner in India. Pat came the reply, ?If we need to be in India for long and to be a competitive player we need to have multiple partners to learn more on the partner?s frugal engineering and product development capabilities. We cannot import a car to fight with Indian companies. At the same time, we need to be aggressive at the entry level point (A, B and B+ segments) in India.?

The Renault-Nissan alliance believes that India is the market to learn more from in order to stay fit. The Indian car market is expected to touch 5-6 million units a year in the next 10 years, as against 2 million units at present. The alliance wants to take advantage of this huge potential and this is where frugal engineering will play a major role.

The Indian car market has undergone a sea change and has become challenging. For Nissan, India is a unique market and Indian engineers are more capable in frugal engineering than others. If this alliance succeeds in India, the same model can be replicated in other emerging markets.

Nissan also believes that it cannot restrict itself to one or two partners in India as each one of them has different frugal engineering capabilities. Nissan wants to learn from every Indian manufacturer to drive the alliance?s global strategy, going forward. Citing an example, Ghosn said it is amazing to note that the cost estimates made by an Indian engineer are one-fifth those of Nissan engineers, which makes a huge difference. This is why Nissan decided to have multiple alliance partners in India for different products. An alliance with each of them will lead to different products in different categories and enable Nissan to push more products at a rapid speed rather than waiting for a single partner to develop a higher number of products, which is time-consuming, Ghosn opined.

ir.ravichandran@expressindia.com