It was very much evident that Mahindra and Renault werent that much happy with their joint

venture. The product of their joint venture christened Mahindra Renault Logan did not manage to return high sales figures after which both the firms entered into blame game. However, there were speculations that the firms had left their differences aside and had planned to launch a small car version of the Logan. But, as a final step, the firms have decided to go their own ways.Mahindra & Mahindra has bought 49% stakes owned by Renault in the partnership and it will be owned as a subsidiary of M&M. The firm will however, not discontinue the production of Logan in India and a few overseas markets.

The earlier speculations about the car becoming a small car have however now proved to be true. The car will be a shortened version of the Logan in order to avail excise duty benefits which are available for cars which are up to or less than 4m in length. There is no confirmed news regarding the continual of the original Logan model though. According to various sources, M&M will also launch a MUV based on the shortened version of the Logan. A part of the sum paid in order to buy a Logan will be delivered to Renault in form of loyalty till the end of this year. The car will sell with the Renault badge too. However, this will not continue from next year after which the car will be available with the M&M badge. There are speculations which indicate that once the car will be sold under the M&M badge, the car may also be renamed.

Mahindra Renault Limited was a JV between India's largest Utility vehicle manufacturer Mahindra & Mahindra Limited & Renault S.A. ofFrance (51% & 49% respectively). The joint venture was formed in 2007. The JV has set up a state-of-the-art manufacturing plant inNashik, Maharashtra. On April 15. 2010 Mahindra & Mahindra and Renault together announced restructuring plans by which Mahindra would buy Renault's share in the joint venture[1] and Renault would continue to provide the support for M&M through license agreement and continue to be supplier of key components.

French carmaker Renault and Indias utility vehicle maker Mahindra & Mahindra have ended their equity joint venture (JV) in the latters home country to make sedans for the domestic market. So far, the JV has launched only one vehicle, Logan, a mid-sized sedan. Logan failed to attract consumers due to its length of fractionally more than 4 meters that required a factory gate duty of 22% compared to 10% for the less-than-4 meter cars. The sedans sales plummeted to 5,332 units in the last fiscal year ended March 31, 2009. Consequently, the JV lost about INR5 billion ($110 million) during the fiscal year. The JV, 51% owned by Mahindra & Mahindra and 49% by Renault, had set up a state-ofthe-art manufacturing plant in Nashik in Maharashtra, India to roll out their Logan in 2007. The car had 50% indigenous content. Mahindra has decided to acquire Renaults stake in the JV and will manufacture the car on its own. However, Renault will continue supporting Mahindra by supplying key components and through a license agreement.

Although Renault has quit the JV, it will continue to focus on the Indian market. Renault intends to build a plant in Chennai to manufacture its Micra model this year and 4 more models by 2012. The automaker plans to export 100,000 vehicles from India by 2013. Recently, Renault and Germanys Daimler AG (NYSE:DAI) has exchanged equity stakes of about 3%, adding the latter to the formers alliance with Japans Nissan Motors (NASDAQ:NSANY). Renault-Nissan was formed in 1999, with Renault holding a 44.3% stake in Nissan and Nissan owning a 15% stake (non-voting) in Renault. Daimler is interested in enhancing the profitability of its Mercedes-Benz A-Class and fuelefficient smart fortwo micro-cars by sharing the development of vehicles and engines with Renault and, thereby, Nissan.

The Business Standard newspaper quoted agency reports as saying that Mahindra was unhappy with both Renault and Nissan entering ventures with other partners in India. Renault has tied up with Indian two-wheeler maker Bajaj Auto to build a low-cost car, while Nissan has signed three other joint ventures with Ashok Leyland.

Mahindra decided to exit from the venture after it found insufficient synergies with the products of the other two companies, the Economic Times newspaper reported, quoting unnamed company sources.
The reason for split was over a blame game between both the manufacturers. Sales figures were dropping drastically of the Logan and it resulted in creation of pandemonium situation between both the manufacturers. Mahindra had purchased 49% of stake in Renault which is still in partnership. The Logan is extinct in the market as the car did not attract buyers. Low sales are the main reason for the split. Since both of them were not doing fine in the Indian auto sectorthe reason for withdrawal is taken.