Global carmakers such as Ford and the Renault Nissan alliance are planning to make India a major hub for the development and sourcing of compact engines. The move is expected to enable lowering of production and sourcing costs due to India’s low budget capabilities.
Production in India is about 30 percent more cost effective in comparison to that in Europe, state industry experts. The large volumes of cars and engine sourcing make it further easier for the carmakers to control costs.
The American carmaker Ford which currently exports the Figo hatchback and the EcoSport compact sports utility vehicle from India is now planning to source small capacity engines known as Dragon from its Indian production unit.
Renault’s research unit in Chennai (India) is also in the process of developing a 986 cc petrol engine in collaboration with its Brazil and European facilities. The engine will be used for a new car to be launched by the year 2015-16.