Renault Samsung Turns Away From Japanese Parts Supplier

The South Korean division of  the French manufacturer Renault SA plans to rely more on local firms for acquiring automotive components after its Japanese suppliers were hit by the March 11 quake and tsunami, disrupting the carmakers production.

In April, Renault Samsung Motors, was forced to reduce production volume at its Bussan plant by 20 percent as a consequence of supply chain disruptions in Japan. Furthermore in May, it normalized production as Japan's parts crisis eased, but the carmaker saw its sales drop 9 percent on its domestic makret and overseas in the first half partly because of a production loss.

“What we continue to do is... to localize as much as we can in Korea, provided that Korean suppliers are competitive, which is most of the time the case. This is what impacted us in terms of the yen /won exchange rate in the past and what impacted us in the tsunami for instance. So I think this is a critical and priority task for us,”  CEO and Representative Director of Renault Samsung Motors, Jean-Marie Hurtiger, was quoted as saying by autonews.com.

Also, the French manufacturer was considering introducing a new shift scheme at its new facility, in order to extend production at the same time raising optimism about its sales for the second half. The Bussan factory, with an annual production capacity of 300,000 vehicles, exports cars under the brands of Renault or Nissan Motor for the Middle East, China, Russia, South America and Europe. Their products include Nissan’s Sunny and Almera and Renault’s Fluence followed by Latitude.