M&M might sell Nissan''s small cars

New Delhi: Mahindra & Mahindra (M&M) just might be the one to market small cars, without having to manufacture them.

Industry sources suggest M&M is in the advanced stages of negotiations, which would see the forging of a marketing tie-up with Nissan Motor Company for its small cars.

Nissan has earlier made public that it has plans to enter the Indian car market with some of its existing small cars. That announcement had not indicated how its products would be marketed.

The company has a marketing arm in the country, which sells its SUV, the ''X-Trail'', and ''Teana'', but industry sources opine that the company may not have adequate infrastructure and reach to cope with the demands of small car distribution.

Reportedly, M&M too may be keen to establish a marketing joint venture with Nissan, similar to the one it has with Nissan''s sister company, Renault. That tie-up has put M&M in the car segment in India, with the Renault Logan. M&M holds the majority stake in Mahindra Renault India.

M&M and Nissan, along with Renault, are equity partners in a manufacturing project at Chennai. Nissan plans to eventually manufacture its small cars in India, leveraging M&M''s widespread M&M dealer network to market their products. The Renault Logan is already being sold across the country via the existing M&M dealer network.

The Chennai project has M&M holding 50 per cent equity, with the remaining resting with the Nissan-Renault combine.

The plant would have an installed capacity of four lakh vehicles per year, and is reportedly facing a delay in its 2009 launch plans.