Renault to re-enter China with minibus

TOKYO, (Reuters) - France's Renault SA (RENA.PA: Quote, Profile, Research) will re-enter the Chinese market by resuming production of microbuses in 2010, Automotive News China reported on Wednesday, citing unnamed sources.

The French carmaker will invest 1.5 billion yuan ($215 million) in the minibus project, code-named W72, initially aiming to build 40,000 vehicles a year at an existing factory in Xiaogan, in the eastern province of Hubei, the industry journal said. A Renault spokeswoman declined to comment on the report.

Renault is one of the few global automakers with no presence in China, the world's second-biggest auto market.

Carlos Ghosn, chief executive of both Renault and Japanese partner Nissan Motor Co (7201.T: Quote, Profile, Research), told reporters at the Beijing Auto Show last month that Renault was still assessing the right timing to re-enter the increasingly competitive passenger car market.

Nissan has a local 50-50 joint venture with Dongfeng Motor Corp (0489.HK: Quote, Profile, Research), and Ghosn said Renault would eventually join that partnership.

Renault also plans to sell the new minibus in other emerging markets including Brazil, India and Russia, the report said.

Renault had a joint venture producing the Trafic commercial minibus in 1994 with Sanjiang Space Industry Group but dwindling sales led to a production halt in 2002, Automotive News China said. ($1=6.991 Yuan) (Reporting by Chang-Ran Kim)