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Fame or money for Tata Nano?

January 14, 2008

The Tata Nano is making world headlines, and at the same time in India there are heatedtelegraph.jpg discussions on why it is not good for the nation because of our poor road infrastructure. It is estimated (according to the rating agency CRISIL) that the Indian car market will expand by 65 percent. Well, I do think the argument as to whether the Nano is good or bad is irrelevant as those criticizing the Nano for this reason need to think of all cars not just the Nano.

But what what I really wanted to write about is that like all Indians, I feel proud that an Indian company has achieved this milestone of making the world’s cheapest car and that too with an excellent design. It is a big feather in the cap of our engineers, designers and in fact the complete Tata team. As it says here:

Good design was the critical element behind making effective savings in material usage, reducing mass and weight, getting the weight distribution spot-on for both ride and handling plus also stability and safety. Good design also made the engineers opt for the rear engine placement, in the process gaining both large occupant space and also major cost savings…

The Economist says:

Competitors will, for example, notice how Tata shrank the car into what its chairman calls a “concise package”, with the powertrain at the back and the wheels at the “extremities”. The result is 21% bigger inside than the Maruti 800 but is only 80% as long…

The Times article goes on to say:

The complete project cost for the Nano, from design, development and production engineering a facility to make 250,000 units per annum are pegged at Rs 1700 crores – exactly the same amount the company spent a decade ago to kick start the Indica project…

Fame, but at what cost?
Well, if the Tatas spent Rs 1700 crores I suspect that this is a fraction of the cost of what an international automobile company would have spent on a similar project. But despite this, the question remains: Will the Tatas make money on the Nano? Not many think so. Yesterday on television I heard Rahul Bajaj, a big industrialist in the two-wheeler industry say that while he admires the Tata achievement he would not have gone in for such a venture as the margins are too low. He was in this business to make money he said.

Well, I do believe that Ratan Tata is in this business to make money as well…but I also believe that he is thinking long term. I think Ratan Tata has a vision just as Jamshedji Tata had a vision when he built the first Taj Mahal hotel in India. This is a quote from my write-up on the Taj Hotel:

The Taj was built at a time when Indians were not allowed entry into most of the prestigious hotels and clubs in British ruled India. Legend has it that this was one of the reasons why Jamshetji Nusserwanji Tata, the first Indian industrialist built India’s first luxury hotel. He went ahead with the project although he was busy with plans to industrialise India. The first Taj Hotel, the flagship of the Group was born in 1903 and stood alone for almost half a century. Initially it was smooth sailing, even though the original hotel was conceived and built when the hotel business was not even considered an industry.

An astounding success such as the Nano (I hope I am not speaking too soon) has certainly boosted the image of the Tata group. And from the reaction all over the world it is clear that Tata is on the automobile map of the world (as are Indian engineers!).

The question is not how many rupees Ratan Tata is going to earn, but how much this venture has enhanced the reputation of the Tatas. The kind of splash made with the Nano will benefit the Tatas in every sphere, in take-overs, in deals, in recruitment, in share value. And well, the Tatas are likely to make some money from the Nano too. But whether or not Ratan Tata plans to raise the price of the Nano a few years down the line or whether or not the Nano sells like hot cakes, one thing is for sure – Tatas will profit from this. The Tata is where it is today even after a hundred years because it’s a profitable brand. And Ratan Tata for all his emotional rhetoric about keeping a ‘promise’ is a hard-nosed businessman.

Related Reading: The history of the brand Taj
A funny battered car on Mumbai roads (Real life humour)
Increasing population and how it can affect energy consumption

60 Comments leave one →
  1. January 14, 2008 5:12 am

    Cool achievement, who would have thunk it! If someone could also think on the level of cheapest school, cheapest vaccine, etc., it will be heavenly.
    Predatory capitalism, anyone?

  2. January 14, 2008 5:54 am

    Nita, I don’t think that any industrialist will go ahead with such a venture, unless he at least feels that he will be making some money, how ever low the profits might be. I don’t know about the short term effect, but I do feel that in the long term, Tatas will only gain from this move. Such an expansionary strategy speaks volumes about a company’s commitment to add shareholder value. Isn’t there a saying that people start doubting, writing and criticizing about you only if you’ve done something extraordinary? This is what Tata has achieved.

    To talk about this car and then talk about the poor infrastructure of the roads is not done. It is not Tata’s problem if the roads in the country are not good/wide enough. That’s an issue that the Govt. needs to deal with asap. But yes, it does hamper the car business indirectly. Even then, will a common man who rides a two wheeler think about the roads of the country before buying a car that costs only around Rs. 1 lakh? I don’t think so.

  3. January 14, 2008 6:00 am

    Forgot to add- I think that driving a cheap car that costs only Rs. 1 lakh through these roads filled with mini-craters is better than buying a VW or any other german car (whose parts are so expensive) and then torturing it on these streets. In fact, bad roads demand cheaper cars!

  4. Vivek Khadpekar permalink
    January 14, 2008 6:00 am

    @ Nita:

    //…those criticizing the Nano for this reason need to think of all cars not just the Nano.//

    We do. The Nano merely adds an exponential dimension to our apprehensions.

    @ Rambodoc:

    //If someone could also think on the level of cheapest school, cheapest vaccine, etc., it will be heavenly…Predatory capitalism, anyone?//

    That would go a long way in expiating the “predator” — a sure ticket to heaven! :-) !

  5. January 14, 2008 6:11 am

    Nita, as with everything, there are both pros and cons.
    In the pros column, I can add technological+design achievement, innovation, Indian pride, a middle-class family able to afford a car, increase in comfort level through use of car, increased revenue for Tata and economic boost for India if overseas market for Nano works out etc.
    In the cons column, there’s loss of productivity and increased stress as more people spend more time stuck in traffic (that’s a given with current roads + more cars in urban areas), increase in air and noise pollution, increased car culture affecting rate of obesity, more trees cut down to make parking lots etc.
    Sure, as these cons manifest themselves down the road, “solutions” will follow, but I’m not ready to hail it as an unqualified success. IMO, a public transport system for Indian cities (like Delhi Metro) is of a higher priority than a cheap car.

  6. Vivek Khadpekar permalink
    January 14, 2008 6:18 am

    Ruhi,

    //…bad roads demand cheaper cars!//

    Wonder if you have seen or heard of a legendary little French car called the Citroën 2CV. Go to http://www.answers.com/topic/citro-n-2cv. There’s also a whole lot of other sites devoted (literally) to the subject.

  7. Vivek Khadpekar permalink
    January 14, 2008 6:20 am

    Amit,

    //a public transport system for Indian cities (like Delhi Metro) is of a higher priority than a cheap car.//

    I vote for that!

  8. January 14, 2008 7:31 am

    Ruhi, a use-and-throw disposable car?? :) :)
    That’s not a wise use of (finite) resources by any means, and reflects poor design and poor thinking.

  9. vish permalink
    January 14, 2008 7:33 am

    ‘To talk about this car and then talk about the poor infrastructure of the roads is not done. It is not Tata’s problem if the roads in the country are not good/wide enough.’

    Yes, it is not Tata’s problem. They got 1000 acres from the govt free of cost. Now, lets blame the govt for the poor infrastructure!

  10. January 14, 2008 7:35 am

    thanks Rdoc, Ruhi, Vivek, Amit,
    Interesting points raised. Well, about cheap vaccines, I believe epople have though along these lines but examples do not come to mind. I am sure you can do a post on ths rdoc!
    Ruhi, I agree this should wake the govt. up and help it get going!
    Vivek, that’s true but it’s not fair that only the Nano is targeted. I think old, polluting vehicles should be targeted first.
    But on the other hand I do believe that what Amit said should be the prority. Improvement of public transport. And once this is done then it will discourage people from getting their own vehicles. I hear that in places like London even rich people use public transport. But mumbai at least is a long way from that. Though there ar plans for the metro nothing concrete on the underground yet! And with our growth in population, once the metro comes up, it won’t be enough!
    But one thing is for sure. Private companies have to keep doing their thing, they cannot do the job of the govt. they will keep making new cars. that’s their job anyway.

  11. January 14, 2008 7:44 am

    Vish, the govt in west bengal did give the land to the tatas at dirt cheap rates. but it wasn’t for nothing. the govt, is desperate to indulstrialise bengal and went overboard to help the tatas set up. no one forced them to do it. tatas i think have done west bengal a favour…see today! for 2 days their plant had to stop work! In my opinion ratan tata was too hasty and fell for the cheap rates…now i hope the activists don’t create more trouble for the tatas. they could easily stop work. i think the activists should ask the govt to stop industrialisation, not blame the tatas. frankly it won’t upset me too much if tata comes to maharashtra! unfortunately many states lost out in the race and in this business of competition of the states other states will be only too happy if west bengal stops wooing industrialists.
    to each his own! :)

  12. January 14, 2008 7:50 am

    Amit,

    //That’s not a wise use of (finite) resources by any means, and reflects poor design and poor thinking.

    Don’t people go for cheaper cars because we know that the roads are really bad? I don’t know about you, but whenever my family in India thinks about upgrading their car, they always always assess whether such and such model willlast the shocks of mini craters. No point buying bigger cars if they won’t last on Indian roads, right? So, in that case, I would say that buying Tata Nano would actually be a wise thing to do! Maybe Tata also assessed this angle, right?

    As far as your comment on disposable stuff goes, I can talk a lot about it. Most of us in the western countries use paper towels for everything! Kitchen towels for cleanign the kitchen, wet towels for cleaning the fridge, different set of towels for cleaning the car, another set of bathroom rolls for the bathroom and so on and so forth. Is this poor designing? Definitely not. It serves the purpose. But it is poor thinking if we take into regard the long term environment effect and doesn’t come under the category of a wise use of resources. So, I would separate “poor designing” from “poor thinking” even in the case of Tata Nano. What’s wrong with the designing? Then again, in the case of this car, what’s wrong with the thinking, if we taken into consideration the condition of roads, money etc? Everybody loves to upgrade his/her car every couple of years. So why not buy this? How can this is a poor use of resources? I fail to understand.

    If I keep using the same car for a prolonged period of time, then it will use more gas and will cost me much more. Isn’t that a poor use of resources and poor thinking? That’s the reason I said that it’s better if we don’t get into that angle.

  13. Vivek Khadpekar permalink
    January 14, 2008 8:38 am

    Nita,

    //…it’s not fair that only the Nano is targeted…//

    I agree entirely. If you look at what the genuinely concerned people have been saying and doing (most of it away from the glare of instantly gratifying and instantly forgotten TV splashes and newspaper headlines), is to question the very concept of private vehicular transport. They are campaigning for better and more effective public transport that will wean people from private vehicles, with both incentives and disincentives.

  14. January 14, 2008 8:47 am

    Ruhi,
    this cat can be skinned in many ways. A higher standard car is more likely to withstand the potholes for a longer time than a lower standard cheaper car. So it makes sense to design a car keeping in mind the road conditions, instead of designing a car that will break down sooner and necessitate getting a new car, because many other parts of the car will still be in good condition and unaffected by bad road conditions. That’s a waste, unless the good parts are salvaged and reused. I think poor design results from poor thinking, or externalizing the costs, so they both can go together.

    As for your other examples, again, they can be skinned in different ways, but that would be beyond the scope of this discussion. My family (parents) in India is not in the same socio-economic level as yours, so the question of upgrading cars hasn’t really come up. :)
    My dad still drives Maruti 800 (one of the original ones made in Japan before production started in India) which has withstood the condition of Indian roads for 18+ years now. That is good design.

    If I keep using the same car for a prolonged period of time, then it will use more gas and will cost me much more. Isn’t that a poor use of resources and poor thinking?

    I think you’re extrapolating and ascribing words to me that I didn’t say, nor intended (poor thinking? ;) . :p ). Of course there will be a point of diminishing returns where it does become wasteful to continue using a car that has become inefficient and polluting. But that has nothing to do with buying a new car in the first place.

  15. January 14, 2008 8:53 am

    Also it’s a bit early to say how Nano will fare. Maybe it is designed well-enough to not break down easily when it comes to Indian roads.

  16. ulag permalink
    January 14, 2008 9:02 am

    The target consumer group of the TATA Nano is the people having two wheelers. The logic is that instead of shelling out 50k for a bike, consumers ,especially the ones who have small families and cramp together on bikes(and you get a lot of those in India), would rather go in for the nano. But is our infrastructure ready to handle this? We have the cars..cool. Where are the roads? All roads in India are very much cramped and bogged down with traffic jams. Its only gonna get worse. Tata has not created a product which had demand, he has created a demand for his product. Imagine people who were using bikes that gave mileage of 50-60 kmpl shifting to a car that gave 20 kmpl. Increase in pollution, increase in fuel consumption.
    True our government has to be blamed for its failure to build up infrastructure. But then the government should also be blamed for its heavy subsidies on fuel which encourages people to use more. There is a need to encourage car pooling to save fuel and ease traffic in our cities. Will that be possible with the nano? Didnt Ratan Tata think of all this?
    I feel the main reason Tata did bring out his car was to show the world his companies’ skills in developing low cost products. Its only a matter of time before companies start outsourcing their manufacturing businesses at the very least if not a whole-scale tie-up, not only with the tatas but other companies as well( as in the case of Bajaj and Nissan).

  17. January 14, 2008 9:10 am

    I think most argument for and against the Nano, here and outside, are taking two inherently contradictory sides. The side that finds the Nano to be good, are looking at it as consumers or from the Tata pov, where the bottomline is all important. As long as safety and emission requirements are met, there isn’t much a government can do in way of hindering its sales.

    Those that are finding the Nano tough to digest however, are looking at it as a “nation” or as environmentalists (not that this view is better).

    I hardly wish to comment on how good the Nano is technologically, since I hardly know anything about the car, but it certainly isn’t Ratan Tata’s problem to solve India’s traffic problem s or tackle global warming all by himself.

    An improved public transit system isn’t for the Tata’s to bother with, though I am sure they might consider investing if the government can lay a long term road map (pardon the pun) while making it economically viable. Remember, the multinationals “owe” you nothing.

    Rather than wasting breath over Tata’s having overlooked what the nation needs, the environmentalists and those that have something against the car, should look at more relevant and controllable aspects, such as improved mass transit, car pooling legislations etc. This is a futile argument IMHO.

  18. January 14, 2008 9:12 am

    //…bad roads demand cheaper cars!//

    That’s definitely one way to go. Another is: bad roads demand better roads.

    Vivek, thanks. A well-functioning public transport system is a winner when compared to individual cars. I think ulag has made some good points too.

  19. January 14, 2008 9:22 am

    //So it makes sense to design a car keeping in mind the road conditions, instead of designing a car that will break down sooner and necessitate getting a new car, because many other parts of the car will still be in good condition and unaffected by bad road conditions.

    So…you’re already assuming that because it’s pricecheaply, it’s part are “cheap”, as in, they will break down?!

    Just because a Ford might be costlier than Nano doesn’t mean that Ford is of any good. I wouldn’t even go near a Ford, just like many others. ;)

    //My family (parents) in India is not in the same socio-economic level as yours, so the question of upgrading cars hasn’t really come up. :)

    Now, that is something that I didn’t mean. You know what I meant and why I made my earlier statement.

    //But that has nothing to do with buying a new car in the first place.

    Exactly! that is why i don’t understand why you started talking about ‘disposable cars’ and poor design and poor thinking. Didn’t make any sense to me.

    I agree with Depressed Dormat in that why should tata care if the roads are good or not? As long as his car meets the govt. safety standards and he can deliver what he promises, his job is done.

  20. Raj permalink
    January 14, 2008 10:16 am

    Nita,

    I knew you would pen(key in) an article on the Nano.I was waiting for it.

    I am going to bat in a totally unexpected manner here.

    As an ardent supporter of small(less than 4m,with a cubic capacity of less than 1.2l for petrol and 1.5l for diesel),fuel efficient,safe,comfortable,eco-friendly and affordable cars,I simply love the cute Nano! I hope Ratan Tata’s baby car goes on to become a cult car like the Volkswagen Beetle not just in India but also throughout the world.The little beauty is Indian engineers gift to our beautiful planet.

    I have been reading foreign(and Indian) reports of the Nano and I must say that the car has split the population into two.

    On one side are the supporters of the car who welcome it because inexpensive(not cheap please!),safe,comfortable,fuel efficient,non-polluting cars like the Nano are cool and egalitarian and eco-friendly while humungous,ostentatious luxury cars and fuel guzzling,obnoxious fume spewing SUVs are the curse of our planet.

    On the other side are an unlikely combination.Environmentalists with misplaced fears team up with the notorious scoundrels in the auto lobby and with the filthy rich(who want the roads to be kept clear so that they can drive along drunk at illegal speeds and run over pavement dwellers).This side seems to go to any length to criticise the little Nano.

    I am not going to talk about the auto lobby and the filthy rich.They are incorrigible.

    I would address the Greens with misplaced fears.Yes,I too,am a Green who feels that we have already done enough damage to our planet with our insatiable greed.I am a supporter of modern,comfortable,extensive and inexpensive public transportation.I do feel that private vehicles must be taxed to subsidise public transport systems.But I don’t think that the Greens should single out the Tata Nano for criticism which is what many of us are seen to be doing.If anything,we should force the auto lobby and the governments to ban humungous,wasteful,fuel guzzling,obnoxious fume spewing SUVs and luxury cars in favour of small,eco-friendly cars like the Tata Nano.

  21. January 14, 2008 10:26 am

    So…you’re already assuming that because it’s priced cheaply, it’s part are “cheap”, as in, they will break down?!

    I didn’t assume that, you did:

    Forgot to add- I think that driving a cheap car that costs only Rs. 1 lakh through these roads filled with mini-craters is better than buying a VW or any other german car (whose parts are so expensive) and then torturing it on these streets. In fact, bad roads demand cheaper cars!

    which started the whole back-and-forth and the “cheap” car. I also clarified in my comment above re: Nano and roads and breaking down.

    Now, that is something that I didn’t mean. You know what I meant and why I made my earlier statement.

    What did you mean then? ;)

    I agree with Depressed Dormat in that why should tata care if the roads are good or not?

    I don’t think in any of my comments I’ve blamed Ratan Tata, or criticized him. In fact in my very first comment, I gave both pros and cons as I see them. You and DD must’ve someone else in mind. :)

  22. January 14, 2008 10:40 am

    Amit, there are two kinds of cheapness:

    1. Cheap in price and cheap in quality

    2. Cheap in price , but still good in quality.

    German cars don’t fall in either of these categories. And Tata Nano- hopefully, falls in #2. Whereas you meant #1.

    Regarding the rest of your statements, I’m not interested in starting a flame war here.

  23. January 14, 2008 10:50 am

    //I don’t think in any of my comments I’ve blamed Ratan Tata, or criticized him. In fact in my very first comment, I gave both pros and cons as I see them. You and DD must’ve someone else in mind. :)

    I was not talking about you- it was more of a general statement. :)

  24. Sam permalink
    January 14, 2008 11:03 am

    I have my doubts about ‘Nano':

    1. Is it a camouflaged rickshaw? I mean has it been constructed on a three-wheeler platform?
    2. Are the Tatas hiding something? It is difficult to believe that a giant like Tata Motors would take this long to come out with a ‘golf cart'; I think they had started with something much more sophisticated, which went kaput; so they released this one.
    3. I don’t think that Nano will compete with Maruti 800; in fact, the real competition is with the Bajaj petrol rickshaw.
    4. Fibre glass body, is it? But that is not an innovation. Years ago, we already had the fibreglass ‘Dolphin’, which met with some success, but was then withdrawn.

  25. January 14, 2008 12:09 pm

    @ Nita: Interesting post!

    Much discussion has already happened and it seems only you will have the patience to read all comments :-) So here are the thoughts that crossed my mind when I read about the Nano and then this post:

    1. It is not essential for an otherwise profitable company to make money on every product. I am surprised Ruhi did not bring up the concept of “loss leader” and instead went for they must make some money.

    2. All this is fine but who will teach Indians driving? The NY Times article on Nano began with a reference to those who own cars but do not know how to drive. The availability of Nano will do nothing to alleviate those numbers and the number of road accidents will be one of the many parameter to watch.

    3. I read the comments above about some relationship between the quality of roads and the quality of cars they demand. The important thing is not how good or how much the road surface is, in India, and what car it may deserve.

    Experience from developed countries – after all, isn’t India trying to emulate them by aiming for their (perceived) lifestyle and by making the verisame mistakes in its path to development as they made? – shows that the improvement in the quality and amount of road surface means more cars start appearing on roads.

    In the absence of a viable alternative, such as cheap and reliable public transport, the Nano will only cause more havoc with urban roads and probably also rural roads (or whatever we can call them paths).

    It remains to be seen how it copes with the potholes-filled Bangalore roads, for instance.

    4. I have found no discussion yet of the car’s fuel efficiency. One of the criticisms levelled at the auto industry is that nobody ever goes back to the design board. They just tinker around the edges and that is why earth-shattering concept cars are hard to come by.

    At a time when the energy crisis – terms such as “peak oil” may be familiar to some of the readers here – is real and growing rapidly, notwithstanding India’s “friendship” with countries that are sitting on the largest sources of oil, I would have expected a car like this to run on alternative fuels or on a clean fuel of some kind.

    Nita, many of the world’s largest companies take on projects for reasons no greater than the CEO’s ego. I hope this is not one of those fancy projects. In the Jaguar discussion, Ratan Tata said if the deal is signed, he may retire. Who knows the Nano may be his swan song, consequences be damned.

  26. Vivek Khadpekar permalink
    January 14, 2008 12:29 pm

    Shefaly:

    Thanks for a much-needed dose of healthy cynicism!

    Vivek

  27. January 14, 2008 12:37 pm

    Nita, this is one of those posts which calls for a re-visit 8-12 months down the line to evaluate how Nano has affected the quality of life of Indians. :)

  28. Vivek Khadpekar permalink
    January 14, 2008 12:57 pm

    Shefaly:

    //…it seems only you will have the patience to read all comments…//

    You ain’t read nothin’ as yet if you ain’t checked out this: http://jalopnik.com/343003/the-2500-tata-nano-unveiled-in-india

  29. ulag permalink
    January 14, 2008 1:07 pm

    I completely agree that its not Ratan Tatas job to bother about indian roads. He delivered on his promise and showed the world the talent in India. Kudos to him and his team. Its really a revolutionary car which has met all the standards so far. As i said before he has created the demand in the automobile market just when it was shifting towards luxury cars and many brands like bmw and audi were entering the market. But when you make a product you think about its potential market. He should be knowing the state of the market in India. Financially its great. But in terms of infrastructure its pathetic. This is not only for TATA. Its for all car makers. So why this barrage against nano? Simply because people imagine that since this car is so cheap it will sell like hot cakes and accelerate a complete breakdown of the system, which would have happened anyway ten years down the lane. They just feel this car will accelerate that BECAUSE it is so affordable.
    I agree that its the government’s prerogative to ensure that doesnt happen. But come on guys…when have u ever believed that our governments can do anything right? :P
    We need more taxes on new vehicles in the cities. We need stricter rules and strict enforcement and an efficient public transport system so that theres a viable alternative. We need car pools. We need to walk more and drive less(lesser distances). All this will automatically happen when the fuel prices increase and are not subsidized so heavily.
    Im no communist no socialist no environmentalist. I dont even have a bike. Im just a regular college going guy and every single day that i go pillion on my friend’s bike i come in direct contact with the monstrosity of dug up roads, potholes, heavy slow moving traffic, not to mention the pollution.Its one big mess here but things go on. If theres any more congestion of our roads everything will just come to a standstill. Forget nanos. Even more autos will cause a breakdown. Maybe the nanos wont sell as rapidly or in such volumes as is being made out. You never know. But what the heck, everyone loves playing devil’s advocate!!! :P

  30. January 14, 2008 1:12 pm

    @ Vivek:

    Thanks for the link. The comments, although many more in number, are crappier in quality which is to be expected. It is an American site and this is an Indian car.

    However the glaring misplaced apostrophe caught my eye: The Peoples’ Car??

    Somebody, please, send a grammarian to the PR agency!

  31. January 14, 2008 1:20 pm

    Ulag, yes I think in one sense this was a kind of “show-off” from the Tatas. Also, I tend to think that even if a two-wheeler owner does buy a Nano, it will never replace his beloved bike, for the reasons you mentioned.

    DD, when you say “it certainly isn’t Ratan Tata’s problem to solve India’s traffic problem s or tackle global warming all by himself.” I agree! How come I am agreeing with you nowadays? Ahh, I guess that post which I promised you I would write hasn’t yet arrived! But rest assured, it is coming!

    Raj, I almost didn’t write this post as I didn’t want to write what everyone else was writing. Then finally when I thought I could write something at least a little different, I went ahead. I agree with your general argument and especially when you say we “should not single out the Tata Nano for criticism”

    Sam, I cannot say about the technological aspect but somehow I don’t think this is like the rickshaw, certainly not in design or comfort levels. I am not sure about the fuel consumption or about the life span of the Nano but I think the Nano looks beautiful. How well it performs remains to be seen.

    Shefaly thanks a lot for an international perspective and also the management perspective. About the Nano being Ratan Tata’s swan song, it’s a dreadful thought isn’t it! But like you said very aptly, money is not the only thing he is seeking for Tata and this I have taken pains to emphasize! In fact that is the purpose of the post…but whether he is seeking personal glory or not, I cannot say. Time might tell.
    This car is supposed to provide 20 kms per litre, which is good by the standars of other cars and better than some two wheelers. but ofcourse it remains to be seen whether the car delivers. It is claimed that maintenance would be low, but the proof is in the pudding. if the car cannot take Indian potholes, it’s finished. And er…I forgot the drivers! :)

  32. Vivek Khadpekar permalink
    January 14, 2008 1:44 pm

    Shefaly:

    Of course the comments are crappy! But a welcome bit of comic relief after all the hoopla in our own press (and also some on this blog).

    I have already complimented you about your healthy scepticism, so I won’t repeat myself (in fact I think I used the word “cynicism”, which now seems to have nearly lost the meaning that I sought to convey).

  33. January 14, 2008 2:13 pm

    @ Nita:

    “This car is supposed to provide 20 kms per litre, which is good by the standars of other cars and better than some two wheelers.”

    The actual, i.e. delivered, fuel efficiency of a vehicle depends, amongst other things including those related to design, on the conditions in which it is driven.

    What if all owners start adding A/Cs in their cars? Or does this car not provide such possibility?

    Even so it is remarkable to me that they did not consider alternative fuels in their design.

    Maintenance is amongst those other things affecting performance, which brings me to …

    ” It is claimed that maintenance would be low..”

    There is, as far as I know, no regime in India to determine the roadworthiness of the car which should be tested annually. If there is, people probably bypass it, going by the furious fumes belched by the millions of cars on the road. So there is really no pressure to pay for “maintenance”.

    Many people still drive without any kind of insurance (and even more drive without a licene at all), which would otherwise also demand annual maintenance.

    It astounds me to see how few drivers in India use their rear view mirrors and how few cars actually HAVE side-view mirrors and how of those few, rare ones seem to be using them. These factors would make the car unroadworthy in many “developed” countries, but not in India.

    Needless to say in my view, this “low maintenance” claim is just PR-hogwash.

    @ Vivek: Thanks.

    I do not drive. In my experience, driving from A to B in the UK takes the same amount of time, if not more in most cases, as taking our awful – and expensive – public transport does. Besides I can read, drink water, eat something (although I rarely do, since I dislike people who do it) and doze, while using public transport. The same is more or less true for European countries that I have lived, worked or holidayed in.

    In fact, in London, those who know better, know it is quicker to walk sometimes than take the tube. Since our congestion charging started, the number of cars on London streets has reduced by a third. There are also pedestrians-only areas in cities which means that people who want to walk or cycle can do so with ease and without fear of being decapitated…

    Some Indian cities, such as Delhi, are truly enormous and walking/ cycling is not an alternative but the Metro has made many such journeys shorter, affordable and pleasant.

    There are many paths to development and it amazes me to see that India is taking the well-trodden path – complete with incipient mistakes – rather than using this opportunity to do something spectacular with sustainable planning and development.

    An argument I have seen in this Nano story is “why curse only the Nano?” This comes clearly from those whose desh-bhakti has blinded them to the wider debate on sustainable transport, energy futures and sustainable economic growth with greater societal participation. Nano may be a symbol of that greater societal participation but it is unfortunately also a symbol of all the other things that require more than market solutions. And if it lives by the sword of media and PR hoopla, it must also bear the scrutiny in other matters that comes with such over-exposure.

  34. January 14, 2008 2:26 pm

    Shefaly, thanks. Ofcourse conditions are what determine the fuel consumption. that is what I meant by saying “it remains to be seen whether the car delivers” but i guess I did not specify. As for PR hogwash, well, I guess he means relatively speaking Nano vs other cars. But as I said, time will tell.

    p.s. I know that was not addressed to me, but to Vivek, but you mention that:

    An argument I have seen in this Nano story is “why curse only the Nano?” This comes clearly from those whose desh-bhakti has blinded them to the wider debate on sustainable transport, energy futures and sustainable economic growth with greater societal participation.

    I don’t think one follows the other. In other words, I think those who say why curse the nano could also mean that all cars should come under scrutiny, not just the Nano. And these people could well believe in “sustainable transport, energy futures and sustainable economic growth with greater societal participation.”

  35. Raj permalink
    January 14, 2008 2:32 pm

    Nita,

    Thanks.Yes,I do believe that environmentalists are missing the wood for the trees in our country.

    I am pained to see that they are spitting venom at a cute little 624cc,twin-cylinder,33PS,20kmpl ‘nano’car that is 3.1m in length and weighs a little over 600kg and is eco-friendly and safe enough.

    I have not heard many Greens in our country criticising obnoxiously nauseating fume spewing SUVs and luxury cars that are around 5m in length,weigh more than two metric tonnes,have 6 to 10 cylinders(yes,10 cylinders like the VW Touareg) that add upto more than 3000cc and guzzle fuel at the rate of 3 to 6 kmpl or even worse.Misguided Greens in our country give the impression that they are batting for such nauseating,planet destroying monsters when they single out the baby-faced ‘nano’car to vent their ire.

    Why can’t the misguided Greens of our country bare their fangs at the SUVs and luxury cars that are the real curse of our beautiful planet?Why can’t the government heavily tax these ugly beasts that are causing irrepairable havoc to our planet?Why should they target an eco-friendly little ‘nano’car that does a tiny fraction of the damage that nasty SUVs and nauseating luxury cars cause to our planet?

  36. Vipul permalink
    January 14, 2008 4:39 pm

    Shefaly – i seem to be at a loss with a few things you mention:
    //Even so it is remarkable to me that they did not consider alternative fuels in their design.//
    Remember the entire basis of the car is its price appeal and affordability. It is remarkable to me that you were expecting a Prius for 1 lakh?

    //In fact, in London, those who know better, know it is quicker to walk sometimes than take the tube.//
    Where? Unless you’re walking between 2 tube stpos that are a block from each other (and there are very few of those)

    // blinded them to the wider debate on sustainable transport, energy futures and sustainable economic growth with greater societal participation.//
    I believe these wider ‘debates’ and policy discussions are best had in academic circles and the results published in journals. As a capitalist, I believe you need to make things happen – in the medium to long term, the market (and not the govt) is the best regulator.

  37. krenim permalink
    January 14, 2008 4:56 pm

    good good good so indians finally managed to build something original unlike your somewhat more troublesome northern neighbour.
    Congratulations!

  38. January 14, 2008 5:03 pm

    Nita,
    Whatever industralist comment, debates. I think If Ratan Tata said Nano is cost effective with good milage, Nano will produce less pollution, then it means. cause even TATA is businessman he is genuine social person, who has always been serving for society for years ( i dont think any of big businessman/family doing same ) .
    He will not cheat people.
    Most importantly peoples those were unable to think about 4-wheeler, now they can dare to own.
    for that we have to proud that we(India, TATA, Indian engineers) produced world’s cheapest car.
    hats off to TATA.

  39. Vipul permalink
    January 14, 2008 5:06 pm

    Hi nita – (my comment entered at 4:39) might be a little off-color. The intent is to straight talk rather than be malicious. Hoever, will fully understand if it fails you moderation net!

    Cheers

    Vipul, your comment could not possibly fail my moderation net. it is not personal. only personal comments get deleted. however at times comments get into moderation for which I have no explanation for. Only wordpress knows! – Nita.

  40. Vivek Khadpekar permalink
    January 14, 2008 5:19 pm

    ALERT: THE RESPONSE APPEARING UNDER MY NAME AT 5.03 pm is not mine. May I request the relevant Vivek to add a distinctive marker?

  41. January 14, 2008 6:22 pm

    Krenim: :)
    Vivek, thanks for your response.
    V. Khadpekar, don’t worry about the misunderstanding as Vivek is calling himself Vivek and that itself should distinguish him from you. Everyone knows you sign in as Vivek Khadpekar.

  42. Raj permalink
    January 14, 2008 7:00 pm

    Vivek Khadpekar,

    Billions of bilious blue blistering barnacles! Now I will have to differentiate between the two Thomsons(Thompsons?) :-)
    —————————————————————————
    vivek, on January 14th, 2008 at 5:03 pm Said:

    Vivek,

    I agree with you.I have never been a fan of businessmen but the visionary Ratan Tata is an exception.He seems to be a genuine social enterpreneur as he believes in giving back to the country that has made the Tatas what they are.Though their ancestors were from Persia,the Tatas have contributed immensely to the development of our country and have managed to instil a sense of self-respect in many Indians.Persia’s loss is India’s gain!

    I can only pity those Indians who lack self-respect as they mock their fellow Indians who are patriotic.Those chaps are only too eager to believe what our former colonial masters and the imperialist media dish out to them.

    I will quote the Mahatma here:

    First they ignore us,
    Then they laugh at us,
    Then they fight us,
    Then WE win!

  43. January 14, 2008 10:42 pm

    It’s interesting how quickly we all forget history. In case anyone has forgotten, the first real success in the automotive industry was the Ford Model T. Can you imagine the negative press in today’s world if some company offered the Model T for sale again?

    The Tata Nano is a breakthrough that should be celebrated rather than condemned. It’s quite easy to mock this car from the front seat of a luxury SUV getting 10 miles per gallon, but the rest of the world needs more cars like this, not gas guzzlers.

    The only thing better than this car would be one that is electric, but that causes problems as well if the power grid can’t support the needs. It would be nice if everyone in the world could walk, or ride a bike or use mass transit, but that is not possible. Mobility and prosperity go hand in hand.

  44. Raj permalink
    January 14, 2008 11:42 pm

    Brian,

    Thanks for your honest,unbiased comments.Obviously there are many conscientious people like you in the “first world” who refuse to believe what the media dishes out to them.It is due to the opinion of people like you that the real Green agenda will come through.

    Most of the Greens in my country seem to be contradicting the real Green agenda.These people are very elitist and hypocritical.They drive around in congested Indian roads in massive SUVs and luxury cars,fly around the country frequently and indulge in conspicuous consumption that will put someone in the “first world” to shame.These people think that being a Green is a hobby.They forget the life and ways of a great Indian Green like Mahatma Gandhi who was a true Green in a time when no one had even heard of terms like “global warming”,”climate change” or “greenhouse gases”.

    Many of these Indian “Greens” have a hidden agenda.They want to use the cover of being a “Green” to divert attention from their wasteful lifestyles.Possessing more material comforts in life than what is required,they simply cannot understand the struggle that a common man in India faces everyday.These “Greens” belong to the Right and not to the Left as is the case with global Greens.Many Indian “Greens” are shameless hypocrites.

  45. Raj permalink
    January 14, 2008 11:55 pm

    Correction:

    It sould be “a great Indian Green CALLED Mahatma Gandhi”

  46. January 15, 2008 12:25 am

    @vivek: I hardly believe the Ratan Tata is a visionary. If you bother finding out about the Indian automobile sector you will hear some gory horror stories about the Tatas and Bajaj. However, I wont hold those against them while judging their work. Those that paid attention to the growth of the Indian auto sector in the 90’s through international competition, know what I am talking about.

    Quoting vivek:
    “Though their ancestors were from Persia,the Tatas have contributed immensely to the development of our country ” End quote

    I am confused about the intent of your mention of the “ancestors”. I shall wait for a clarification before making any assumptions.

    @Krenim: I am assuming your comments were not meant to be derogatory to either Indians, or the chinese, but even so, it won’t hurt to find out about all the “original” ideas that have come forth from both these places, in the past as well as present.

    @Nita: I guess we do have common ground after all.

  47. January 15, 2008 1:32 am

    great ! :( thanks to tata now even poor guys are gonna pick up girls with minimum effort. that narrows down the market for players like me! :)

  48. Raj permalink
    January 15, 2008 2:27 am

    The Depressed Doormat,

    The comments that you attribute to Vivek were actually written by me,so I will respond.

    I hate to speak about myself,but I am a keen follower of the Indian automobile sector,so I know what I am talking about.I do not bat for the Bajajs but let me tell you that both RATAN TATA and a former chaiman of Tata Motors-SUMANT MOOLGAONKAR were TRUE VISIONARIES when it comes to the Indian automobile sector.I can give you reports by independent people if you want.I am not a believer in false reports funded by Tata Motors’ foreign competitors whose ‘international’ products were thrashed and humiliated by the home grown ones of Tata Motors(formerly known as TELCO or Tata Engineering and Locomotive COmpany).

    When I said that their ancestors were from Persia,I was only praising the immense contribution made by the Tatas to MY country and the pride that they take in being Indians unlike many ‘Indians’ who only seem to be too eager to lick the boots of the imperialists.

    If you think you can draw me into a flame war about the integrity of Ratan Tata or Sumant Moolgaonkar,let me tell you that you will be disappointed as I do not want to embarass our host Nita.

    P.S.: Just to make sure that you do not assume things about me,I neither work for Tata Motors(or any other Tata company) nor do I have anything to do with them.As a true Indian,I only admire the contribution the Tatas have made to MY country.

  49. January 15, 2008 2:51 am

    Thanks Raj for your reply. Media spin occurs in every country and for many different reasons. I find it interesting though that the chief complaint in many of the media articles deals with the safety aspect. It’s true a small car, of any make, would be crushed by a truck or larger car, but then whose fault is that? If everyone in the entire world drove a Nano, then how would it be a problem? It’s a choice to drive a large eight-cylinder vehicle and if you want to pay and pay for poor fuel economy, then that’s your choice.

    Besides, when oil runs out we’ll all be back to walking again. :D

  50. Raj permalink
    January 15, 2008 3:05 am

    The Depressed Doormat,

    And by the way,Depressed Doormat,I completely agree with your views about Krenim’s comment.

  51. Raj permalink
    January 15, 2008 3:26 am

    Brian,

    Yes,you are right.Most of the mainstream media guys have a hidden agenda these days.They are always ready to do the bidding of their biggest advertisers.

    The fact is that the Nano has passed all Indian safety and emission norms.I am sure the Indian spec Nano will meet almost all European norms as well and the Tatas can always build in improvements to meet any crash norm that it does not meet in the Indian version.
    This is because,only the Tatas have a full fledged crash test facility in India(apart from the regulatory authorities) and the R&D team of Tata Motors will do any auto company proud when it comes to value engineering.

    By the way,the Tatas themselves build a few SUVs apart from other normal small cars.But thankfully they are concentrating more on small cars and eco-friendly technology these days.They have a licence from MDI of France to equip their cars(in all likelihood only the Nano) with the revolutionary compressed air engines though this may take some time.

    http://www.theaircar.com

  52. January 15, 2008 3:38 am

    @Raj: This was hardly an attempt to start up a flame war. If you thought it was, I apologise.

    My point about the persian ref. was that they can’t be called persians anymore. And that does not further heighten any of their achievements, the argument that they are not “original” citizens of India (saying this I realise the inaccuracy and inherent faults in the statement, so don’t take it at face value).

    As for your comments on visionaries inside the Tata camp, I must inform you I have no idea. The point I was conveying however, which you must know is how the Big Indian companies drove the west out of maharashtra, something which may have proven to be a boon for the western half of maharashtra and in that breath, Mumbai as well. Whether Tata makes great cars or not was hardly the point, and that takes us into a completely different aspect of this debate altogether, and I hope you have no interest in pursuing that any further.

    As for my information coming from “biased international competition”, that is hardly the case. It was apparent for anyone that was interested in the growth spurt of the Indian auto business. And if you further go to debate over the quality of cars the International car makers brought in (such as Ford, Nissan, Mitsubishi, Honda etc) then I think we will be going far off tangent. The fact remains, that the International competition is the only reason the Indian auto industry is where it is today. Had it not been for the Fords and Hondas, you and I would be driving our dear old Premier taxis.

    Anyway, I think we should end this debate, since it is off topic and the Nano has ceased to remain the focus of our discussion.

  53. January 15, 2008 4:34 am

    The header pic tells a lot !!

  54. Raj permalink
    January 15, 2008 4:37 am

    The Depressed Doormat,

    I am sorry if you have been taken aback by the ferocity of my comments.Believe me,that was not my intention at all :-I

    Yes,I do agree with you that the ancestors of the Tatas ceased to be Persians when they settled in India.The Tatas therefore can only be Indians,no doubt about that.I wrote that comment to show that India has always attracted immigrants and continues to do so even now.

    And I do agree that foreign competition has been of benefit to the Indian auto sector as it has helped(only to a certain extent though) companies like Tata Motors(and a few others) to emerge much stronger.

    Yes,there is no need to carry on this debate as it is increasingly veering off the central issue about the Nano.

  55. anuragsaurabh permalink
    January 15, 2008 5:15 am

    So NANO is making too much of noise…
    Dr.Madhukar Shukla of XLRI wrote about this car sometime in November. here’s the link… http://tinyurl.com/yohqcj
    Go through it you will like it…

    As far as Shri. RATAN TATA is concerned, he showed his business acumen right from the time he thwarted RUSSI MODY’s attempt to control TISCO.. He’s a no-nonsense man, he is writing history for himself and INDIA…

  56. January 15, 2008 8:15 am

    Raj, I agree with you that when we need to stick up for our own country Being critical is one thing, but seeing nothing good in our country at all and continuosuly harping on the negative points shows something else. It shows contempt.
    As for Krenim’s comment I hardly took it seriously. He knows as well as us our great heritage and our achievements otherwise too. btw he is very young, barely 18, but if you notice he too has praised the Nano even though he is English!

    Brian,
    thanks for your postive comment. What you said “mobility and prosperity go hand in hand’ is bang on! One needs to look at this Nano achievement in the positive light. tearing down an historical achievement in our country is a shame!

    Anuragsaurabh, thanks for the link. I agree with your assessment of Ratan Tata as being a no-nonsense man. Yes, he is writing history alright!

  57. Raj permalink
    January 15, 2008 10:41 am

    Nita,

    Yes,I agree.It always pains me to see something condemned to the gallows without being given a fair trial.People,even in our own country,are tearing apart the newly born ‘nano’car without even having a close look at it.How can one condemn the car and its maker after just looking at the pictures?And looking at the pictures,one will only see a cute little ‘nano’car.

    Yes,I agree that Krenim’s comment can be seen in a positive light.And I hope that some of my comments too are viewed in a positive manner,as they have the potential to be seen in a negative light.I have nothing against other countries or their citizens or any of the commentators in this post.I apologise if anyone feels offended by some of my words.

    Ravishankar,

    You have hit the nail on the head.I think Nita has explained about the header image in the post about the Lead India logo.

  58. Phantom permalink
    January 23, 2008 3:39 pm

    Tata Nano – the 1 lakh wonder……a remarkable achievment no doubt.

    The technological, financial, artistic achievemnts of this prject aside, I wonder whether the indian govt hasn’t shot itself in the foot by allowing such a product to come to a market that quite frankly, is bursting at its infrastructural seams. If even 30% of all scooter/bike purchasers now get a Nano, I shudder to think of how badly it’ll impact an already woefully pathetic traffic scenario. Sure, that isn’t Tata’s probllem…they’re a private sector corporate who’s primary aim is to increase shareholder value and develop its brand and product offergin….but this is INDIA”S problem…and definitely has long term repercussions for corporate india.

    Further deterioration of traffic and roading infrastructure will impact on the operations of enterprises within urban centres. Pollution will of course increase, as will consumption of fuel. Perhaps a positive impact might be that many manufacturing and processing centres be set up away from urban centres, to avoid the traffic, and this will have a trickle down effect on the surrounding sub-economy.

    Moreover, with every paanwala and his dog now looking to buy a Nano, or 2……that doesn’t exatly help as an incentive to use public transportation….and if there’s one thing that the urban centres in india need , its effecient public transportation.

    So, all in all….kudos to Tatas for their technical and strategic achievemnt, but an indictment on the govt for perhaps not keeping long term social, commercial, and infrastructural and environmental issues in mind.

  59. January 23, 2008 6:45 pm

    Phantom, let’s look at this positively. The Nano will put our infrastructure back by about 10 years and as we always wake up at the last minute, now is that last minute and the govt. will wake up do something! Look at our trains. People are on the roof and falling out and that is why we are now going for the underground! :)

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