BOMBAY (Reuters) -- Nissan Motor Co. said on Thursday it would consider manufacturing in India or joining hands with a local partner to catch up with its rivals in the country.
"We recognize that we are latecomers, and we realize that there are peculiarities to this market, but we believe there is great potential and we are confident we can grow quickly," Yoshie Motohiro, Nissan India's managing director, told Reuters.
The Japanese automaker, 44-percent-owned by France's Renault SA, has invested $960,000 in setting up its wholly-owned Indian subsidiary, and plans to expand its local dealer network.
The maker of the Altima sedan and Infiniti luxury cars is faced with uncertain growth in the United States and Japan, and is looking to markets such as China and Russia for growth.
It launched the X-Trail compact sport utility vehicle in India last August, and sold 130 units in the year to March 2005. The company hopes to nearly double sales this fiscal year and will look at introducing small and mid-size models.
"These segments are growing quickly in India, and there is also potential for SUVs, so we are keen to tap that," said Motohiro, the first woman at Nissan to run a regional subsidiary.
Renault recently struck a separate joint venture with Indian utility vehicle maker Mahindra & Mahindra Ltd.'s to build the French carmaker's Logan cars at a plant in India with a capacity to make 50,000 cars, a 125-million-euro project.
"That venture will have no relation with ours, but if we find some common areas in which we can cooperate on, we may look at those at some point," Motohiro said.
Rivals Toyota Motor Co., Honda Motor Co. and Mitsubishi Motors Corp. are firmly rooted in India, with a passenger vehicle market of about 1 million units a year.
Toyota aims to double its market share in India to 10 percent by 2010, and Honda, which has a joint venture with India's Siel Ltd., is increasing its annual capacity to 50,000 cars from 30,000 by the end of October.
Mitsubishi last month said it would expand production of its Lancer sedans in India to 4,500 a year, export more models from Japan, and buy parts from its Indian partner, Hindustan Motors Ltd.
Other foreign car makers are also stepping up production to meet growing demand in India and use it as a regional export hub.
The world's biggest carmaker, General Motors, said in March it had more than doubled annual capacity to 60,000 units and could raise production to 80,000 units if necessary.
Korea's Hyundai Motor Co., India's second-biggest car maker, is building a second car plant at a cost of $450-500 million to take its production capacity to 400,000 by 2007.
Czech car maker Skoda Auto, a unit of Volkswagen AG is nearly doubling capacity, while German car makers BMW and Volkswagen are looking to set up car plants.