Nissan ramps up production at Chennai plant for Magnite

Japanese automaker Nissan is ramping up the production of the newly launched compact SUV Magnite at its Chennai plant to meet the robust demand in India.

A top company official said production would touch about 3,500 units a month by July at its Chennai plant. Nissan Motor India, which ended the 2020-21 with a total sales growth of 6% at 18,886 units from 17,831 units in 2019-20, is looking at a three-digit growth this fiscal, although the second wave of COVID and supply constraints, especially that of semi-conductors, remain a challenge.

The company, in December 2020, had announced to hire 1,000 people to ramp up production with a third shift at the Chennai plant. Rakesh Srivastava, Nissan Motor India Managing Director, told PTI that from February, the third shift started. “Now we are ramping up the production. We believe that going forward we should be able to take up this production, which is currently in the range of around 2,700 per month to close to around 3,500 per month in the next three months.”

Srivastava said this is their plan, but it could be challenged by way of semiconductor shortage or shortages in terms of components or the COVID-19 pandemic. The company is working with its channel partners to address supply chain issues. “The semiconductor situation has not improved and the challenge is only growing. The shortages are very, very strong in the market. Normalization will happen only after July. Currently, the challenge is still there and it is only increasing.”

In regards to the demand, Srivastava said preference for personal mobility driven by COVID-19, availability of liquidity in the market with lower interest rates and availability of credit has fuelled sales.

“The shift towards petrol vehicles from diesel, which are priced higher, has also driven in more affordability. Manufacturers pushing more petrol vehicles have also helped customers in terms of their ownerships,” he said. “Going forward, I foresee that the auto industry could grow anywhere around 25% in the ongoing fiscal, largely because of a lower base, but Nissan have the capability now to grow in three digits. We should be more than doubling our volume.”

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The top executive brought to the fore that for Nissan, till December, the auto industry had actually declined by 16% in the April-December period, but the company had a decline of 55% during that period. “However, after the launch of Magnite, it caught up every negative to end the fiscal on a positive note.”