A final word about the reconciliation between Renault and M&M is on the cards. But there is a speculation that the revamping process will involve much indigenous nature for Logan. Despite in the market for the past 5 years, the vehicle is not able attract many customers who felt disappointed with the offering. The consequence was the loss to the tune of Rs500 crore in the last fiscal. According to the Chairman and CEO of Renault-Nissan disclosed that the process of restructuring the car will be done in India to compensate time and cost too. Thus the revamp will not be carried out in the Europe facility, but in Chennai unit.
The long pending reconciliation on the size of the car for availing the relief in excise duty- from the current 22% for larger size cars- may come to an end. To avail this relief, the cars shall be within 4 metres long with the engine capacity of 1.2 lit for petrol and 1.5 lit for diesel. If the restructuring is implemented, then the cost of the car would come down by Rs50000-Rs75000 and increase the sale, feels M&M. The current price of Logan is Rs4.7 lakh- Rs5.75 for petrol version and Rs6.17 lakh – Rs7.64 lakh for diesel version.
Renault sees the cost factor involved in round about way, if the car has to be revamped. The import of minimum 50% parts will incur heavy cost output and hence the localization is preferred. In all the car needs a total restructuring to attract the customers since there is nothing special in this Logan to justify its brand value. Renault and M&M will have a tough time to counter the price factor from other small car makers to boost the sale of new Logan. The new Logan may hit the new customers hailing from smaller cities and M&M has to ploy a devise to drag the customers for a whole new world. In this regard we have to wait and see whether new Logan would be juxtaposed with Scorpios.