Renault's long-term sales target for China is bold -- 600,000 to 700,000 -- given that the French automaker sold just 32,000 cars there last year. The goal, however, shows just how far behind Renault is in the world's largest market as French rival, PSA/Peugeot-Citroen sold nearly 560,000 vehicles in China last year and Volkswagen Group sold 3.27 million vehicles there in 2013.
Renault has struggled to gain a foothold in China. In 1993, it established a joint venture with a subsidiary of China’s state-owned aerospace technology company, but sales were poor and the partnership stopped making vehicles in 2004. Renault's China growth will continue to be stunted by the country's high import duties until its new greenfield plant begins production in early 2016.
Company veteran Jacques Daniel, who has led Renault's operations in China since February 2013, shared the automaker’s future plans for the market during an interview with Automotive News Europe Editor Luca Ciferri at the recent Beijing auto show.
Renault will soon have local production in China. Could you tell us more?
Last January we began construction of a greenfield plant in Wuhan, Hubei province, with our joint venture partner Dongfeng Motor. Together we are investing the equivalent of 870 million euros and we will commence with an initial capacity of 150,000 units a year. Production will start there at the beginning of 2016.
What will be the new plant’s first car?
It will be a brand new product, a D-segment crossover that Renault will also build in Europe for Europe. Keep in mind that 85 percent of our sales in China currently come from the Koleos compact crossover and 15 percent from the Fluence compact sedan. Looking at the most recent developments in the Chinese market, where SUVs are selling very well, a larger crossover is the perfect starting point.