Logan: Renault's Low Cost 'World Car'
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Case Code: BSTR261 Case Length: 21 Pages Period: 1999 - 2007 Pub Date: 2007 Teaching Note: Not Available |
Price: Rs.400 Organization: Renault SA, S.C. Automobile Dacia SA Industry: Automobile Countries: Global Themes: New Product Development |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Project X90
In the mid-1990s, Renault, under the direction of the then chairman and CEO Schweitzer, made a strategic decision to expand its presence in markets outside Western Europe...
The Making of the Logan
Logan was a car designed to strict specifications. The designers were given clear requirements with regard to the size, design, and most importantly, the cost of the car. Given that Logan was intended to be a world car, Renault also had to ensure that the requirements of all the markets were met. Renault approached the development of the Logan as a completely new project. Typically, low priced cars were stripped down versions of popular cars. Sometimes manufacturers also remodeled outdated versions of cars sold in the developed markets, for developing countries...
Safety
Although Logan was a no-frills car, Renault claimed that no compromises had been made on safety. The designers adapted the safety solutions used in state-of-the-art Renault cars to make them suitable for the Logan. Logan was designed to meet the European Union's safety norms. The top-end Logan included an Anti-lock Braking System (ABS) similar to the one used in the Megane. ABS was an optional feature in the lower-end version. The top-end Logan also included driver and passenger airbags, and backseat safety belts for three in the rear passenger cabin...
Logan's Specifications
The Logan was a three box saloon, with a 'tall boy' design aimed at maximizing interior space. It had a wheelbase30 of 2.63 meters. The car was designed to carry five adults, and had a generous boot space of 510 liters (bigger than in many cars, including top end ones). Although it was not designed as an 'off road vehicle', Logan was given a ground clearance of 155mm (about one inch more than other comparable cars), to be able to tackle poorly maintained roads in its target markets. Logan was initially developed with two engine versions - a 1.4 liter engine with 75 horsepower and 83 lb-ft of torque, and a 1.6 liter with 90 horsepower and 95 lb-ft of torque...
The Launch and its Aftermath
Renault launched the Logan in June 2004. The entry level version was priced at 5,000 Euros (around $6,000 at the time), making it the lowest priced sedan in Europe. It was first launched in Romania and then in the Central and Eastern European markets...
The Prospects
After the success of the Logan saloon, Renault launched the Logan MCV, a station wagon, in September 2006. The MCV came in five and seven seat versions, and was priced between 8,000 Euros to and 11,500 Euros. This vehicle used the same engines as the Logan saloon. In January 2007, a minivan version was launched. This was priced between 6,700 Euros and 8,800 Euros. A hatchback version was expected to be launched in Romania in 2008. According to analysts, the Logan's biggest strength was its low price when compared to other cars in its class like the Chevrolet/Daewoo Kalos, Hyundai Accent, Kia Rio, Skoda Fabia, Ford Focus, and VW Golf...
Exhibits
Exhibit I: A Note on Dacia
Exhibit II: 'European Car of the Year' Winners from Renault
Exhibit III: Annual Income Statement -Renault
Exhibit IV: Top Automobile Manufacturers in the World -2006
Exhibit V: Logan's Technical Specifications Key Dimensions
Exhibit VI: Sales of Renault and its Subsidiaries - 2006
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