The current slowdown in the car industry has forced Nissan to defer its expansion plans in India.
Nissan and Renault together committed an investment of Rs 4,500 Crore till 2015 for their new car plant at Chennai. One portion of this investment is now held back in view of the uncertain economic situation in the market. The alliance also states that the plan for the Greenfield plant has also been realigned due to uncertainty in the car market.
The proposed plant would have a production capacity of 4 Lakh units which is equally shared by Renault and Nissan. However, the alliance will start one production line for rolling out cars. The infrastructure for the second line will be worked upon when the market will bounce back and the demand increases. The alliance also feels that this revision in the expansion plans may help them balance short-term and mid-term capacity requirements for both the car companies.
Nissan's light commercial project in partnership with Ashok Leyland has also been postponed by about six months. This delay is mainly due to the land problems in Tamil Nadu where the alliance is setting up their new plant.