Rumour: Renault shelves Kwid-based compact sedan

Speculations about Renault working on a Kwid-based compact sedan first came to light in June 2016. Reports had mentioned that the French automaker is working on a compact sedan based on the CMF-A platform, which was developed under the Renault-Nissan alliance. However, recent reports indicate that Renault might have shelved plans for a Kwid-based sedan, owing to dropping interest in the compact sedan segment.

Additionally, the impending GST tax structure might cut down the special tax benefits that are currently received by cars under 4-metre in length. Once this tax benefit goes out of the equation, compact sedans might lose their popularity even further (related thread).

The compact sedan segment is currently facing a tough competition from compact SUVs. People upgrading from hatchbacks are now opting for crossovers or compact SUVs, skipping the sedan segment altogether. This has forced automakers like Renault to re-analyse their strategy and plans for entering the segment at this point of time.

Renault will now likely be focusing on developing larger, premium hatchbacks and crossovers on the CMF-A platform. Being a modular architecture, this platform can support a variety of body structures.

Source: Autocar India