Nissan has slowed down its projects in India, including a billion-dollar car plant, due to the current economic climate. The Renault-Nissan alliance began construction of the plant near Chennai in June last year. With an estimated cost of US$ 1.14 billion, the Chennai facility was scheduled to begin operations in 2010, with two production lines boasting an eventual capacity of 400,000 cars a year. The company is now said to be thinking of a single production line with a capacity of 200,000 units per year. The second line, according to sources at Nissan, will be put in place after the eceonomy picks up. This second line is thus expected to be put in place by 2011. 

Other than the Chennai plant, the small car project with Bajaj Auto in Pune is also expected to get delayed by a year. Scheduled to start operations in late 2010 or early 2011, the project is now expected to take off by the end of 2011. After registering double digit growth almost consistently, the auto industry in India is now showing a year-on-year decline of up to 20 per cent.

Allison Transmission, Inc., supplier of commercial duty, fully automatic transmissions and hybrid propulsion systems, has commenced work on its Chennai facility. The company recently broke ground on a new India facility designed to meet the growing global demand for Allison automatic transmissions. Expected to go on stream by 2010, the 203,000 square feet Chennai facility will serve as the Allison Transmission India Pvt. Ltd. regional headquarters with executive, marketing, and sales offices. It will also have warehousing and customisation. 

Speaking on the occasion, Lawrence E. Dewey, Chairman and Chief Executive Officer of Allison Transmission, Inc. said, "We believe it is important to strengthen our local presence in India to support our growing in-country operations". Ram Amarnath, managing director of Allison Transmission India added: "We conducted an extensive and lengthy search before we settled on an area in which to build our India facility. We found the right mix of location and a talented, world class employment pool in Chennai". 

Interestingly, Allison's association with India goes back more than 40 years when it began serving the country's mining and oil field industries. In 2007, Allison established permanent offices in India, operating under the name of Allison Transmission India Pvt. Ltd. to realise growth opportunities in the on-highway market. In recent years, Allison Transmission's growth in India has been propelled by fitting automatics into low-floor CNG and diesel buses in Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Nagpur and other Indian cities. There are now nearly 1,000 on-highway trucks and buses operating in India, which are fitted with Allison Transmissions. Major OEM customers include Tata Motors, Ashok Leyland, JCBL and Lexia Motors. In fact, Allison recently concluded a contract to supply Tata Motors with fully automatic transmissions for low-floor, state-of-the-art, CNG-propelled buses to serve Delhi Transport Corporation.