Renault is reportedly considering the introduction of a mass-market electric vehicle (EV) in India, according to sources familiar with the matter. The French automaker aims to tap into the country’s rapidly expanding EV adoption, driven by government targets and incentives.

The ongoing review by Renault focuses on the potential launch of an electric version of its Kwid hatchback, specifically designed and manufactured in India. The study will assess factors such as market demand, pricing, and the feasibility of local component sourcing. If the plans proceed, the launch of the electric Kwid could take place in late 2024.

The move aligns with Renault’s broader strategy to revitalize sales in India, where the company remains profitable despite selling fewer cars in 2022 compared to the previous year. Renault India declined to comment on specific product plans but emphasized the company’s global focus on electrification and India’s significance as a key market.

India is projected to become the world’s third-largest market for passenger and light vehicles, surpassing Japan. The country’s automotive industry experienced significant growth in 2022, with estimated industry-wide sales increasing by 23% to 4.4 million vehicles. The Indian government aims to achieve 30% electric vehicle penetration by 2030, spurring interest from domestic and international automakers.

Renault’s discussions with Nissan regarding the creation of an EV unit have encountered delays, slowing the progress of a potential alliance restructuring. However, one of the sources mentioned that India will play a crucial role in future projects once a global deal is reached.

In India, domestic automaker Tata Motors, along with foreign players like Stellantis, Hyundai Motor, and SAIC’s MG Motor, are already preparing to launch EVs. Renault currently produces an electric version of the Kwid in China, marketed as the City K-ZE, and exported to France as the Dacia Spring.

To qualify for incentives in India, Renault would need to manufacture the electric Kwid at its alliance plant in southern India and source components locally. The plant is predominantly owned by Nissan.

As part of its efforts to revamp operations in India, Renault plans to invest in refurbishing and upgrading its major dealerships in major cities, further emphasizing its commitment to the Indian market.