Tata Nano

Topics: Tata Motors, Tata Nano, Electric vehicles Pages: 7 (1667 words) Published: September 3, 2013
History of Tata Nano
After having successfully launched the low cost Tata Ace truck in 2005, Tata Motors began development of an affordable car that would appeal to the many Indians who drive motorcycles.[4] The purchase price of this no frills auto was brought down by dispensing with most nonessential features, reducing the amount of steel used in its construction, and relying on low cost Indian labor. The introduction of the Nano received much media attention due to its low price. The Tata Nano is a city car manufactured by Tata Motors. Made and sold in India, the Nano is the cheapest car in the world today. Before it went on sale, a price of 1 lakh (US$1,600) was widely touted. Since its 2009 debut, the price has increased; while the Nano remains the lowest-cost four-wheeled passenger vehicle in India, it is significantly more expensive than a motorcycle, a popular means of cheap transport in the country. Expectations and effects

Expectations created for the car during the run up to its production may have been out of proportion with its realized success. A 2008 study, by Indian rating agency CRISIL, thought the Nano would expand the nation's car market by 65% but, as of late 2012, news reports have detailed the underwhelming response of the Indian consumer to the offering; sales in the first two fiscal years after the car's unveiling remained steady at about 70,000 units although Tata appears intent on maintaining a capacity to produce the car in much larger quantities, some 250,000 per year, should the need arise. It was anticipated that its 2009 debut would greatly affect the used car market, and prices did drop 25-30% prior to the launch.Sales of the Nano's nearest competitor, the Maruti 800, fell by 20% immediately following the unveiling of the Nano.[9] It is unknown if the Nano has had a lasting effect on the prices of and demand for close substitutes, however. In July 2012, Tata Group Chairman, Ratan Tata, said that the car has immense potential in the developing world while admitting that early opportunities were wasted due to initial problems.[10] Singur factory pullout

Tata Motors announced in 2006 that the Nano would be manufactured in Singur, West Bengal.[11] Local farmers soon began protesting the forced acquisition of their land the new factory entailed.[11] Tata first delayed the Nano launch and later decided to build the car in a different state, Gujarat, instead.[12] Price

Announced as the least expensive production car in the world, Tata aimed for a price of one lakh rupees, or 100,000, which was approximately $2,000 US at the time.[13] Only the very first customers were able to purchase the car at that price, however, and, as of 2012, the price for the basic Nano is around 150,000.[14] Increasing material costs may be to blame for this rapid rise in price.[15] Compared to the Volkswagen Beetle it has a relatively low price, however. In 1990, a Beetle from Mexican factories was priced at $5,300,[16] about $9,313 in today's money. The Ford Model T's initial price was about $850, equivalent to $21,719 today.[17] The second-generation Nano is expected to be sold in the United States by 2015, however its sticker price will be closer to the Mini Cooper, Fiat 500, and Smart Fortwo due to U.S.-mandated safety regulations to be added to make the car street legal in the U.S.[18] Tata is, however, still aiming the Nano to be the cheapest new car in the U.S., a title that is (as of 2013) currently held by the US$12,780 Nissan Versa.[19] The original Nano is not street legal in the U.S., and can't legally be sold as a grey market import until 2034, when the original 2009 models receive a 25-year exemption from the U.S. Customs and Border Protection.[20] Despite a readily-available dealership network in the U.S. through the Jaguar Land Rover division of Tata, Tata Motors won't use Jaguar Land Rover to sell the Nano.[21] Cost-cutting features

The car's exterior and interiors were designed at Italy's...
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