Franco-Japanese automaker Renault-Nissan will invest $320 million to expand a complex in India, a report said Friday, as it looks to cash in on demand for low-cost vehicles in emerging markets.
The auto giants will spend 30 billion yen ($320 million) to build a second plant at the site near southern Chennai city that will be able to produce 200,000 units annually by the end of 2014, Japan's Nikkei business daily said.
The facility already has an output capacity of 400,000 units a year.
The new plant will produce Nissan's Datsun brand and economy Renault models that are under development, the Nikkei said.
Nissan last year announced it would revive its discontinued Datsun brand to meet demand for affordable cars in emerging markets, with the Nikkei reporting that two new models would initially be priced around 500,000 yen.
Nissan declined to confirm the Nikkei report. A company spokesman said that "we have a project to produce low-priced vehicles in our existing Renault-Nissan joint plant, but we cannot comment on the report further".
The report comes several months after Nissan chief executive Carlos Ghosn said he would think twice before making new investments in China, the world's biggest vehicle market, after Japan-brand auto sales tumbled on the back of a territorial row between Tokyo and Beijing.
Nissan's share price fell 1.48 percent to 926 yen on Tokyo's Nikkei index Friday morning.