December 03, 2018 12:47
Renault Samsung next September will cease production of the Nissan Rogue SUV, which accounts for more than half its output and 70 percent of its exports.
A Renault Samsung source said Friday, "We reached an agreement with French headquarters to stop producing the Rogue in the company's plant in Busan in September next year, and we are continuing negotiations on what to replace the Rogue over the remaining 10 months."
The Rouge had helped the once-struggling automaker return to the black and normalize business operations.
Even if new models are assigned to the Busan plant, however, a change in models would incur the need for new production-line equipment, which would stifle profitability.
The Busan factory has produced the Rogue since August 2014 exclusively for export to the U.S. market, with sales jumping from W3.97 trillion in 2014 to W6.70 trillion last year, taking up some 70 percent of Renault Samsung's exports.
Output volume reached 100,000 units in September 2015, 200,000 in May 2016, 300,000 in February 2017 and 400,000 in December 2017. The 500,000 mark was reached just last month.
Losing that lucrative line could be devastating for the local economy.
But Renault Samsung said the five-year contract is now coming to an end, so the carmaker is "closely negotiating" with headquarters on a new SUV lineup for production, adding that additional models would be designated no later than early 2020.
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