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Will Nissan survive in India?

NEW DELHI: Nissan Motor India which has been struggling since inception is not in a very healthy situation.  A push to revive its lower-end Datsun brand flopped, sales have slumped 60% over the past five years and its sole plant in the country is operating way below capacity., When Nissan decided to enter India it chose Hover as a marketing partner, till 2014 Hover ran its marketing operations and completely ruined it as per experts.

Poor marketing strategies, delay in product launches, not keeping pace with the market, chaotic management policies, frequent top management changes in the last few years have collectively achieved current performance. As last hope to revive Nissan brand in India, Nissan will spend to turn its fortunes around in India will hinge on the sales of one vehicle, its new Magnite compact SUV

The SUV may also determine how much heft Nissan will wield as it and alliance partner Renault thrash out their respective roles in the Indian market.

Unveiled this month and due to be launched either late this year or early 2021, the Magnite will be Nissan's first new vehicle in India in two years. Moreover, it will be just one of three Nissan-branded models in the market after two others were pulled in April when tougher emission rules kicked in.

"Magnite will buy Nissan a couple of years to figure out a plan for India and the SUV's success will determine whether it invests more or scales down operations," said one source. If Magnite doesn't work as per expectation. Nissan may withdraw Indian operations, though they have invested $ 800 million in the plant here in Chennai. This sole plant which is producing cars for Renault and Nissan both as a joint alliance agreement between these two companies. The plant is already profitable and sustainable due to export numbers, domestic operations are a challenge. 

Nissan has less than 1% of the Indian market. But Nissan holds 70% of its jointly owned plant in the southern city of Chennai and exported 80,000 vehicles from the plant in the last business year, five times more than Renault.

A significant number of Nissan dealers in India have closed in the last 2-3 years, even some of its best-performing dealers have opted for other better-performing brands. The big question here is, will Magnite a small SUV be big enough to help Nissan to survive in Indian domestic market.