Tata Nano

The Tata Nano is a 624cc petrol car made by the Indian auto major Tata Motors since 2009. Priced at Rs 1.25 lakhs (approximately $2300.00) it is the lowest priced car in India since. Even though Tata had exhibited a more powerful variant for Europe, it never went to production. After Tata's own Indica, and unlike any other car made in India, Nano was designed from scratch.

The Nano has a 624cc gasoline (petrol) rear mounted engine, four speed manual transmission (no over-drive). It is a four-passenger, four-door car. The car lacks basic safety features like collapsible steering column.

The concept model exhibited in European expos claimed a more powerful engine, heavier and rugged body construction, and more safety features. There were also news from Tata about other concept variants including alternatively fuelled ones and electric variants. But non of these ever went to production.

The story

It was in a press meet in 2007 that Tata chairman Ratan Tata announced that the company will launch a new car cheaper even than the largest selling Maruti 800. He said that it was targeted at the Indian families who travel in two wheelers. Tata did not give any more details, no exact price, no name, no details on the proposed design, nothing. A huge media hype followed the announcement. A lot of commotions followed on the details. Tata had not announced a price, but the media spread commotions that it might be around Rs One lakh. An enormous media hype followed, even beyond the expectations of Mr Tata himself, about tomorrow's largest selling car. Vivid accounts of journalists visualized Indian roads flooded with Nano and its yet to be born competitors.

It might have been the extraordinary media hype that inspired Mr Tata to do what he did eventually. In an uncommon business model, instead of taking a proven design and employing cost cutting measures on it, Tata decided to build an all new car from scratch. This called for a huge initial investment on design and production (and later, the post release glitches). 

Another peculiarity was Tata's decision to build a whole new production facility for the new car, when the company could have used a couple of production lines from an existing facility. There are views that Tata was rather being opportunistic and used the media hype on Nano to harness premium farm land in Bengal. In a state with millions of acres of barren plains, what the govt offered tata was a vast area of farm land in the district of Singur which was owned by numerous small time farmers. Amid individual protests, government made forcible acquisition of the land, and Tata started constructing the plant. The protests of the farmer continued and Govt went on suppressing it with brutal force. Things came to a turn when a state political party, Thrinamool Congress, saw political opportunity in it and took it up. The protests flared and turned to a revolution. Tata and the government of West Bengal defended for months but finally had to give up. Tata closed down the 1500 crore facility, disassembled it into pieces and moved it across to western end of India, Gujarat. And owing to all these pressures Tata was forced to raise the price of Nano.

Originally published in 2009.