Renault's manual overdrive

By Gail Edmondson

updated 1:32 p.m. ET July 20, 2005

Step inside Renault's Romanian factory and check out the anatomy of one of the world's least-expensive cars. French automaker Renault has taken a revolutionary approach to building its new $6,000 Logan, combining a simple design with an unorthodox approach to manufacturing.

To get a quantum reduction in costs, Renault went back to basics and tapped Eastern Europe's low labor costs. Instead of a glittering temple of modern manufacturing, the Logan is build in a renovated, 40-year-old factory of formerly state-owned Romanian auto maker Dacia, which the French carmaker bought in 1998.

Lonely robot
At first glance, the body shop and assembly hall appear to be, well, more than a bit dated. Most modern car plants have hundreds of robots, and production lines are nearly silent.

By contrast, there's only one robot in Dacia's vast, noisy assembly hall. Its giant orange arm gracefully applies glue to windshields moving down the production line -- a task that requires absolute precision in the amount squirted on the rubber rim around the glass.

The rest of the work in the factory, which produces some 175,000 cars a year, is handled by 1,060 employees. A visitor walking around the factory nearly bumps elbows with the many workers on the production floor, and fork-lifts beep constantly to clear the aisles.

Pigs, potatoes, passengers
Yet on closer inspection the Dacia plant, where Renault began producing its $6,000 Logan sedan last year, is a symbol of the the global auto industry's changing dynamics. From China to India, new markets beckon, and the concept of a car that can be sold around the world is ever more alluring.

Renault bought the nearly bankrupt Dacia with the goal of designing and building a simple, affordable car for emerging markets, one without the technology-in-overdrive that has pushed prices too high for much of the world's population.

The Logan was conceived with an emphasis on space -- designed to comfortably accomodate "four adults, a pig, 220 pounds of potatoes and a kitchen sink," according to one Logan manager. Renault originally had no intention of selling the no-frills Logan in the West, but reports of the $6,000 car had consumers demanding it from dealers.

Tried before
Renault finally relented and introduced the Logan to Western Europe in June, where it retails with an extra airbag and a three-year warranty for $9,200. In France, the wait now runs six months.

Renault is hardly the first auto maker to build a car for the world's masses. Other companies such as Fiat have tried. But world-car models have never really caught on. Renault may finally have found the right approach, however.

Renault's designers say the concept wasn't the problem. Rather, it was the approach of trying to strip features off a Western car to make it cheap and attractive in emerging markets. Trouble is, removing passenger-seat airbags and the like doesn't significantly cut costs.

Higher complexity and higher costs are designed into most cars: Consider the number parts used to form a dashboard, electronic controls, and the curvature of the windshield. Redesigning such parts isn't easy or cheap.

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