Renault France's No 2 carmaker is going ahead with plans to build a factory to produce low cost vehicles in Morocco despite the global downturn.

The media in Morocco and abroad cast doubt on whether the factory would be built after the deepening economic crisis forced Japan's Nissan Motor Company which is in an alliance with Renault to withdraw from the project early this year.

The project, being done in partnership with the Moroccan government, was announced in September. At the time the Renault Nissan alliance said it would involve total investments of EUR 600 million in manufacturing capacity.

Mr Carlos Ghosn who is both president and CEO of Renault and president of Nissan flew from Paris to visit the plant site in Tangiers and to meet king Mohammed and top government officials in Rabat to dispel any doubt about the factory's future.

Mr Ghosn said that all what has been planned will be achieved. He had already approved the investment for plant equipment. The buildings of this plant will be erected beginning September this year. The only change would be the rate of production of the factory which would depend on market circumstances.

He said that Nissan would be part of the project in the future as it was now focusing now in a similar project in India. The first cars good for sales will be produced from the Tangier plant in January 2012 as scheduled.

(Sourced from Forbes)