Renault will invest R$2 billion to produce medium SUV in PR – 12/04/2023 – Market

Renault announced this Monday (4) an investment of R$2 billion to produce a new mid-size SUV in Paraná. The car will have “flex hybrid” versions, whose engine will combine ethanol, gasoline and electricity.

The contribution was announced at the automaker’s factory, in São José dos Pinhais (PR), during a ceremony that celebrated the unit’s 25th anniversary. Geraldo Alckmin (PSB), vice-president and minister of Development, Industry, Commerce and Services, was present at the event.

Luiz Fernando Pedrucci, CEO of Renault in Latin America, said that every investment approval is equivalent to winning a battle. However, the executive highlighted that he hopes to maintain a healthy competitive scenario, without regulations that only help some manufacturers.

“What we have announced so far is based on the current rules. We cannot have companies on the market that benefit from different rules,” said the executive.

In an interview given shortly before the ceremony with Alckmin, Pedrucci stated that Ricardo Gondo, president of Renault do Brasil, has the mission of fighting to maintain equal conditions in the national market. Without this, investment plans could be revised.

The CEO’s speech in Latin America refers to the recent extension of tax incentives for companies that produce in the North, Northeast and Central-West regions. The main beneficiaries are the Stellantis group, which has a factory in Pernambuco, and the Chinese BYD, which will assemble its hybrid and electric vehicles in Bahia.

The president of Renault do Brasil stated that total contributions between 2021 and 2025 reach R$5.1 billion in the country. The price includes the compact Kardian, which will hit the market in March 2024. The price should start at approximately R$100,000.

The model will have a 1.0 turbo flex engine and automatic transmission. Its basis is the modular platform of the current generation Sandero, sold in European markets.

Located in São José dos Pinhais (PR), the Ayrton Senna Industrial Complex has four factories spread over 2.5 million square meters. There is capacity to produce 320,000 cars per year, with 5,300 direct Renault employees.

Today, assembly lines work in two incomplete shifts, according to Gondo, making it possible to produce in up to three shifts. The executive believes that future launches will reduce idleness.

The plant completes 25 years of activity this year, and the new medium SUV will be the French brand’s most expensive national car. The initial values ​​must be above R$150 thousand.

Investments in new products seek to recover the profitability and prestige achieved at the beginning of national production. The first model made in Paraná was the Scénic minivan, launched in March 1999 — production began at the end of 1998.

The model won over many customers who, until then, purchased mid-size sedans and station wagons. In the first year on the market, 33 thousand units were sold.

Soon after came the national Renault Clio, which initially had front airbags in all versions. The more expensive options came with velvety upholstery on the seats and a sound system with controls next to the steering wheel, something rare among compact cars at the time.

But the French brand had a hard time nationalizing the Mégane line, which arrived in 2006 as a second generation.

The medium models debuted with a 1.6 flex engine and manual transmission, but the market had already turned to medium sedans with automatic transmissions. Honda Civic and Toyota Corolla were already consolidated and the new Renault, although better equipped, was not as successful as expected.

The brand’s turnaround began the following year, when the popular Logan sedan went into production. Simple and spacious, it adopted solutions such as exterior mirrors that could be installed on any side of the body, which reduced production costs.

The Sandero compact hatch debuted six months later, in December 2007, with the same large cabin at a more affordable price. It was successful for years, but the market downturn since 2013 caused profitability to drop.

Now the brand intends to recover losses with a strategy focused on lower sales volume, but concentrated on products with higher added value.

Only the Kwid will remain a popular model for the automaker, with sales increasingly focused on fleets, mainly from rental companies.

Luiz Fernando Pedrucci, CEO of Renault in Latin America, said that investments are also maintained in Argentina, regardless of the paths that will be taken by the president-elect, Javier Milei, who takes office this Sunday (10).

Pedrucci stated that the company sees the region as a land of opportunities, being accustomed to political and economic turbulence.

“We’ve been eating turbulence for breakfast since we were children,” said the executive.