China’s Changan Automobile plans to invest Rs 4,000 Cr in India, says report
New entrants like MG Motor (SAIC) and Kia Motors experienced immense success in the Indian automotive market. Inspired by this, several Chinese automakers are now eying it too. Days after Great Wall Motor’s India investment plans were revealed, a report in ETAuto outlined Changan Automobile’s India strategy.
Changan Automobile has four international manufacturing facilities in Russia, Iran, Brazil, and Pakistan. The company also has joint-ventures in China with Ford, Mazda, Suzuki, and the PSA Groupe.
The Chinese state-run Changan Automobiles is reportedly planning investments in the tune of Rs 4,000 crore in India in a phased manner. The report states that the SUV and electric vehicle manufacturer will have two separate entities in the country.
One would be dedicated to manufacturing while the other for distribution and after-sales. This strategy is very similar to the unsuccessful relationship Nissan India had with Hoover Automotive.
Changan Automobile’s distribution and after-sales strategy are expected to be tied up with Group Landmark, which already has dealership experience with brands like Nissan, Mercedes, and FCA (Fiat Chrysler). Its first office is expected to be operational soon in Gurugram, Haryana.
The Chinese utility vehicle, passenger car, and electric vehicle manufacturer was earlier linked to India a couple of years ago when it conducted a feasibility study. Back then, the manufacturer had initiated talks with various state governments including Gujarat, Andhra Pradesh, and Tamil Nadu. However, Changan froze further development citing regulatory uncertainty in the country.
Changan’s first product in India is expected to launch in 2022. Initially, the line-up will include the Changan CS75 (premium SUV) and a mid-sized, Hyundai Creta rivalling, unnamed product. The company aims to make India a major export hub, just as its Karachi plant, which rolled out its first product off the assembly line in May 2019.
The PSA Groupe and Changan’s joint venture will be coming to an end later this month as car sales continue to plummet in China with a weak post-festive season performance. Traditionally, the months of September and October are some of the best months for auto sales in China.
(Edited by Saheli Sen Gupta)