GENEVA -- Renault could "decisively" beat its target of selling 1 million of its no-fills Logan cars by 2010 as it chases expansion outside the stagnant western European market, the French carmaker's chief executive said on Tuesday.
The Logan -- sold under the brand of Renault's Romanian subsidiary Dacia -- was launched in September as a low-cost offering to grab customers in fast-growing emerging markets.
Renault has already raised its target for sales of the car from an original 700,000 to 1 million by 2010 after a strong debut and deals to manufacture the car in a number of other countries, including Iran and Russia.
"We will meet our target of selling 1 million (Logan) units in the world by 2010, and I think we will decisively exceed it," Louis Schweitzer told reporters at the Geneva car show.
The Logan will be launched in a number of new markets in 2005, including Syria, Slovenia, Poland and western Europe, with production of the cars slated to start in Russia, Morocco and Colombia.
New markets are becoming increasingly important to Renault, as demand in its traditional western European base shows no sign of recovery with cut-throat pricing putting pressure on margins.
In 2004 Renault's sales rose just 0.3 percent in western Europe, but they grew 101 percent in Turkey and 32 percent in eastern Europe and Russia. The carmaker also enjoyed strong progress also in Africa, the Middle East and Latin America.
But Schweitzer said Renault would put profit and cost considerations first when deciding whether to enter new markets.
Schweitzer reiterated that Renault would not rush into China, despite strong long-term potential in the country, preferring to ensure profitability.
"Our aim is not to compromise the economic efficiency of any involvement in China. We do not have 'as soon as possible' as a priority, but rather 'as efficiently as possible'," Schweitzer said.
"The issue remains how to use existing facilities there before investing in new ones," he said, adding that Renault was in discussions with China's Dongfeng Automobile Co., which already collaborates with Renault's partner Nissan in China.
French rival PSA Peugeot Citroen saw sales in China falter in 2004 after they nearly doubled between 2001 and 2003, as growth in the Chinese market stalled.
Last month Renault announced a partnership with India's Mahindra & Mahindra Ltd. to make the Logan, and Schweitzer said Renault was in a strong position to enter the Indian market.
"We have got a solid network on which to enter the Indian market with a minimum of fixed costs," Schweitzer said. "This first stage is enough to get our name and products known in the Indian market."
He added that development of right-hand drive Logans for the Indian market would also allow it to access the South African market with the vehicle in future.
Schweitzer said he also saw potential for the Renault brand in the United States in the longer term, and repeated that the brand could consider entering that market after 2010.
"Renault is not in the position of having a recognized brand in the United States so any entry would be on the back of the strength of our products," Schweitzer said. "However U.S. clients are open and interested in innovation, and are looking to widen their choice."
He added that any entry would be helped by partner Nissan's production and distribution facilities in the country.
"Nissan's facilities mean we could install ourselves there without having to bear all the start up costs, but we cannot enter the market on the back of Nissan alone, we can only enter on the strength of our products," he said.
Closer to home, Schweitzer added he did not see conditions easing on its European markets in 2005.
"2005 is not going to be any easier than 2004," he said.
Renault posted a jump in operating profits for 2004 but has cautioned that margins could narrow in 2005 as trading conditions remain tough in its key market.