Renault has been active in South America since the 1950s, when it began assembling cars in Argentina. But the company has moved the region to the front burner of its corporate investment priorities.
In Argentina, the Santa Isabel factory in Cordoba makes the old R-19 and original Clio, and last year started to produce Megane hatchbacks and sedans. All four models are produced on the same assembly line. Kangoo production, on a separate line, is just starting.
The Cordoba plant produced 95,000 vehicles a year, but capacity has been increased to 120,000. Renault has a 20-percent market share in Argentina on sales of some 74,000 cars and light trucks.
In neighboring Brazil, Renault will produce 120,000 Megane Scenic minivans and Clio IIs a year at a new, $1 billion plant in Curitiba. One-third of Curitiba's output will be exported throughout Latin America.
Local content will start at 70 percent, rising to 80 percent by 2001. One investment decision was to contract out stamping to Thera, a joint venture formed by Gonvarri and Rhea, which also works for Fiat.
Another $100 million is being invested at Curitiba to add an engine plant with a capacity of 6,000 units a week in 2000. This would cover 80 percent of Renault's regional engine requirements.
In Uruguay, Nordex Corp. assembles the Express van from complete knockdown kits at its Santa Rosa plant in Montevideo, and will start assembling the Twingo 2 in April 1999.
In Chile, Cormecanica supplies all transmissions for Renault in Latin America. The company, a Renault subsidiary, will double output between now and 2001 to 206,000 units a year.