SHANGHAI (Reuters) -- Renault has become the latest foreign carmaker to be targeted by Chinese dealers in disputes over who should bear the brunt of a market slowdown after growth in China's auto market, the world's biggest, halved to 7 percent last year.
Renault has responded to a letter from a Chinese dealer critical of its sales targets, offering help and support to local sellers of its cars and saying it was confident of their profitability in its expansion drive.
The dealer, in a letter posted on the website of official newspaper People's Daily on Thursday, said the Dongfeng Renault Automotive Co. joint venture had set lofty targets and forced dealers to buy more cars than they could sell, resulting in price cuts and heavy losses.
It said 90 percent of the brand's local sales outlets were in the red in 2014.
In the letter, the Renault dealer called for a united front against Renault in a fight for what it said were realistic sales targets. The move came ahead of a dealers' conference later this month, where Renault is expected to set China sales targets for 2015.
Renault said in an emailed statement that sales at its one-year-old venture with Dongfeng had jumped 26 percent last year and noted its local dealers were at "the front line in the battle for China market share."
But dealers are also independent business organizations that are vulnerable to market forces and Renault said it would offer support to those who suffer from "mismanagement and poor performance."
Renault also said it plans to boost its sales network in China by 50 percent this year to capture a bigger chunk of the market. It aims to operate 150 outlets in China by the end of this year, compared with 100 now, the automaker said.
"As a newly-formed venture, our network expansion is not 'rapid' compared with other brands ... and we're confident over dealers' profitability," the carmaker said.
Earlier this month, China's dealers' association said it had persuaded BMW to pay 5.1 billion yuan ($824 million) in subsidies to dealers, while Porsche and Toyota Motor Corp. are also negotiating with their Chinese dealers over subsidies and sales targets.
