CAR PROJECTS SLOW DOWN

The economic slowdown has affected the car sales drastically in the last month which is now in turn affecting the new car projects in the country. The new plant which was to be set up in the out skirts of Chennai in Oragadam by Nissan and Renault is being delayed now due to the present state of the nation’s economy. The car major had plans of investing Rs. 4, 500 crore for setting up the plant but now they are holding back a bit. Nissan had also planned for the manufacturing of commercial vehicles in collaboration with Ashok Leyland which is also on the slow mode. Renault Nissan has announced that this is a temporary realignment which is mainly due to the recent economic downturn. They had plans for investing about Rs. 4, 500 crore till the year 2015 for the Chennai plant which is expected to have a capacity of about four lakh which was to be shared by the two car majors Renault and Nissan equally. The project will speed up as soon as the demand grows. The cars are expected to be out by the year 2010. Nissan’s deal with the Ashok Leyland for the commercial car project is also delayed by six months by which the economic condition is expected to be on the upbeat. There are also rumors that the delay is not due to the slowdown but only due to the problems in land.