The strange absence of the Tata Nano on Indian roads.

The Tata Nano was the car that was supposed to finally paralyze Indian cities. Doomsday predictions had bumper to bumper traffic 24/7 once people loaded up with a 1 lakh vehicle. It was a car that has been featured as one of the 10 most influential automobiles ever made; in potential, another Model-T, the car that would finally take India out of its bullock cart, rickshaw mode and into full automated mobility. And the Nano was supposed to be the nightmare for fuel efficient motorcycle manufacturers – which risk yourself on two wheels when you have safety on four for the same cost? It is now part of the legend of the Nano – Ratan Tata, the much admired head of the Tata empire, musing on the dangers posed by the family pack he saw perched precariously on two wheelers all over India, the father driving and also managing a small child while the mother sat behind, holding onto another infant or jamming it between the parents. The Nano was the small car response to this apparent problem, an economical and safe alternative for families, as well as being their first car.

The thing is, one just has to step out onto the road and see that the Family Pack endures on the two wheelers. So what happened? How did such a grand scheme fizzle out, at least for now? TLR ventures some probable answers.

– They could not hold down the price

Part of the hype, the excitement around the Nano was the price tag. 100 000 rupees. Even as it came time to deliver that price began to creep up. There was nothing Tata Motors could have done about that, as costs were appreciating all over and the whole fiasco in Bengal about the plant and compensation for land did nothing to help either reputations or keep costs down. At present the car is selling closer to the 150 000 to 200 000 mark. It is still a great deal more economical than most but the sheen , the head shaking bemused magic of 1 lakh, {cheaper than the music player of high end automobiles!}, that sheen is off.

The Nano has descended into the realm of the ordinary. In November 2010 the Nano sold only 509 units. In July it was 9000. The Alto meanwhile sold 30 000 units in November and it is priced almost two and a half times higher.

– The car has perceived safety issues

This one was a killer. The Tata vehicles were never going to be known for their frills but sturdiness and safety were assumed. When a car began to burst into flames a few kilometers from the showroom as its proud new owners were heading home, it was a huge credibility loss for the Tatas. Their responses to the situation did not help. The first incident was dismissed as a showroom car that somehow got mixed up with those for sale. Now they say that ‘foreign electrical equipment’ found on top of the exhaust is responsible – which begs the question as to why this was not fixed or anticipated. They called in cars to fix these problems but insisted it was not a safety recall, which is a bit difficult to comprehend.

– They mistook their customer

The Nano was meant for first time car buyers, a transition from two wheels to four, but it is glaringly obvious that has not been the thinking of its potential buyers. In this case I believe Mr. Tata made a grievous blunder, showing an uncharacteristic abstruseness as to Indian Behavior. A car is still an aspiration, a step up in society. India is an ‘izzat’ society, honor, face, status, the whole inexpressible mix that is comprehensible only to the cultural insider. Purchasing a Nano in this mindset would be tantamount to admitting defeat. As long as you and your family pack were perched on a two wheeler, hope was alive. You could hope to upgrade one day, soon, to the dignity of a car. Purchasing the Nano was an admission of financial incapability, and people would rather, or so it seems, risk their lives than make such a public proclamation of straightened means. There is a humiliating concession to reality here; far from fulfilling the dream of vehicle ownership which the Nano was supposed to cheaply provide, it proclaims one’s financial inadequacy for all the world to see.

It is amazing that the Tata people did not think this through. We are an emotional people and make emotional decisions.

– They neglected their real customers

The Nano seems to be a tier two and three city vehicle and also a vehicle of choice for families who wish to give their college going kids a vehicle without compromising on safety or having to spend too much. Even in the USA, when they took the car to show it off, the maximum interest seemed to be in it as a cool on campus commute system. From their ongoing public pronouncements Tata still seems attached to the ‘first car’ mythical customer to focus on rebranding and repositioning the vehicle. It is not likely to be a first vehicle of choice in the major cities; it is more likely to be kept as an economical back up that the kids use. In mofussil India it may perhaps be the first car of choice, though the purchasing power of small towns and villages is quite surprising and they have the same izzat considerations

– Will they turn it around?

Tata Motors remains optimistic. It is foolish to underestimate them. Perhaps they are right. Perhaps they will turn it around. They have just extended the warranty on all cars to four years or 60 000 kms whichever is earlier and added service contracts for just 99 rupees a month. There is no longer a waiting period. Up to 90 percent of the cost is financed at easy rates. Extra safety features are being installed in older cars at no extra cost. New ad campaigns are being run showing the reliability and sturdiness of the car. A youth orientation may serve them well too. In real terms it is too early to judge since the plants in Gujarat can produce only 100k cars per year…

All of this is impressive. It argues fast recovery and good footwork. Maybe the Nano will get the family pack off the Indian roads after all.

Note : This article was written in 2011.