Tata_Nano

Tata Nano

The Tata Nano is a proposed city car — a small, affordable, rear-engined, four-passenger car aimed primarily at the Indian market — first presented by India's Tata Motors at the 9th annual Auto Expo on January 10, 2008 at Pragati Maidan in New Delhi, India. The prefix "Nano" derives from the Greek root 'nanos', meaning dwarf — as with nanometre. "Nano" also means "small" in Gujarati, the native language of the Tata family, founders of the Tata Group.

The project has literally become India's claim-for-fame in the international-media due to Tata Motors' innovation in developing the car, as well as keeping it low in price. The car itself is expected to boost the Indian Economy, create entrepreneurial-opportunities across India, as well as expand the Indian car market by 65%. The car was envisioned by renowned industrialist, Ratan Tata, Chairman of the Tata Group and Tata Motors, who has described it as an eco-friendly "people's car". Nano has been greatly appreciated by many sources and the media for its low-cost and eco-friendly initiatives which include using compressed-air as fuel and an electric-version. Tata Group is expected to mass-manufacture the Nano in very large quantities, particularly the electric-version, and, besides selling them in India, to also export them world-wide.

Critics of the car have questioned its safety in India (where reportedly 90,000 people are killed in road-accidents every year), and have also criticised the pollution that it would cause (including criticism by Nobel Peace Prize-winning scientist, Rajendra Pachauri). However, Tata Motors has promised that it would definitely release Nano's eco-friendly variants alongside the gasoline-variant.

Due to strong and persistent opposition to Tata's Singur car-factory by Mamta Banerjee, Tata Motors ultimately decided to cease operations in Singur on 2 October 2008 and started manufacturing Tata Nano at its Pantnagar plant. On her protests and the consequent pullout, the media heavily critcised her and The Telegraph even said: "India is being raped by those who profess to be her soldiers, the guardians of peace." Financial Times reported: "If ever there were a symbol of India’s ambitions to become a modern nation, it would surely be the Nano, the tiny car with the even tinier price-tag. A triumph of homegrown engineering, the $2,200 (€1,490, £1,186) Nano encapsulates the dream of millions of Indians groping for a shot at urban prosperity. That process has stalled...No big economy has prospered without undergoing a huge, often brutal, shift of labour from the countryside to cities and from farms to factories...There is a yawning gap with China. India’s information technology and service sector, no matter how dynamic, simply cannot absorb enough labour. To truly shine, India will need millions, perhaps tens of millions, more manufacturing jobs. Why has it not created them?"

Currently, Tata Motors is reportedly manufacturing Nano at its existing Pantnagar (Uttarakhand) plant and a plant has been proposed for Sanand (Gujarat), though it's yet to be seen whether it would be successful or not (like Singur). Uttarakhand Chief Minister BC Khanduri reiterated on 4 October 2008 that his government would welcome the Tata Group, if it opts to establish Nano's plant in Uttarakhand state. The company is hoping to produce 50 Nanos per day in Pantnagar by January–March 2009. Ratan Tata has said that Nano will be brought within set timelines. Not many dealers will be appointed till March 2009. The company will bank on existing dealer network for Nano initially. The new Nano Plant could have a capacity of 5,00,000 units, compared to 3,00,000 for Singur. Gujarat has also agreed to match all the incentives offered by West Bengal government.

Introduction

Conception and design

The project to create the world's cheapest production car began in 2003, under the Chairman of Tata Motors, Ratan Tata, inspired by the number of Indian families with two-wheeled rather than four-wheeled transport. The Nano's development has been tempered by the company's success in producing the low cost 4 wheeled Ace truck in May 2005.

Contrary to speculation that the car might be a simple four-wheeled auto rickshaw, The Times of India reported the vehicle is "a properly designed and built car". The Chairman is reported to have said, "It is not a car with plastic curtains or no roof — it's a real car."

To achieve its design parameters, Tata has refined the manufacturing process, emphasized innovation and sought new design approaches from suppliers. The car was designed at Italy's Institute of Development in Automotive Engineering — with Ratan Tata requesting certain changes, such the elimination of one of two windscreen wipers.

The Nano has 21% more interior space and an 8% smaller exterior, when compared with its closest rival, the Maruti 800. The car will come in different versions, including one standard and two deluxe variants. The deluxe version will have air conditioning, but no power steering. The car was expected to be produced in the Singur plant in West Bengal, but due to politically-motivated agitations instigated by the Trinamool Congress, mother plant has been shifted to Sanand in Gujarat. The initial production target set by Tata Motors is 250,000 units per year.

Expectations

According to one report, India as well as other nations, such as European nations, have great expectations from the Nano and are keenly and eagerly awaiting it, especially the electric version of the Nano, which is expected to be released in 2008, making it in all probability the "world's cheapest electric car" officially on record. The car itself is expected to boost the Indian Economy as well as expand the Indian car market by 65%, according to rating agency CRISIL.

Benevolent opportunities for local-entrepreneurs

Modular design

BusinessWeek says:

The Nano is constructed of components that can be built and shipped separately to be assembled in a variety of locations. In effect, the Nano is being sold in kits that are distributed, assembled, and serviced by local entrepreneurs. As Ratan Tata, chairman of the Tata group of companies, observed in an interview with The Times of London: "A bunch of entrepreneurs could establish an assembly operation and Tata Motors would train their people, would oversee their quality assurance and they would become satellite assembly operations for us. So we would create entrepreneurs across the country that would produce the car. We would produce the mass items and ship it to them as kits. That is my idea of dispersing wealth. The service person would be like an insurance agent who would be trained, have a cell phone and scooter and would be assigned to a set of customers."
In fact, Tata envisions going even further, providing the tools for local mechanics to assemble the car in existing auto shops or even in new garages created to cater to remote rural customers. With the exception of Manjeet Kripalani, BusinessWeek's India bureau chief, few have focused on this breakthrough element of the Nano innovation (BusinessWeek.com, 1/10/08).

Pricing strategy

Tata initially targeted the vehicle as "the least expensive production car in the world" — aiming for a starting price of 100,000 rupees or approximately $2300 US despite rapidly rising material prices.

As of August 2008, material costs have risen from 13% to 23% over the car’s development, and Tata now faces the choice of:

introducing the car with an artificially low price through govt-subsidies and tax-breaks, or
foregoing profit on the car, or
using vertical-integration, or
partially using inexpensive polymers or biodegradable plastics instead of a full metal-body, or
raising the price of the car

An increased price on the Nano will likely decrease demand.

Release-date

As of , Tata Motors has not yet announced the release date for Nano. Currently, no orders for the car are being taken but it has been announced that nano will be finally manufactured in Gujarat. Some sources expect Nano's electric- and gasoline-variants to be released in 2008, and the diesel-variant in late or mid-2009.

Others

Effect on Indian Economy Economic Times quotes:

Tata Nano’s launch could expand the Indian car market by 65%, according to rating agency CRISIL. The low price makes the car affordable for families with incomes of Rs 1 lakh per annum, the agency said. The increase in the market is expected to push up car sales by 20% over the previous year. “The unveiling of Tata Nano, the cheapest car in the world, triggers an important event in the car market. Based on the statement by company officials, CRISIL Research estimates the consumer price of the car at around Rs 1.3 lakh. This brings down the cost of ownership of an entry level car in India by 30%,” the company said in a report.

Thus, the Indian Economy is expected to remain strong and grow in 2008 and beyond, despite the temporary financial turmoil in the US, because the car will also lead to a boost in other sectors of the Indian Economy besides the auto-market.

However, due to the current Singur land dispute, the "Stalled Car Factory" is "Costing Jobs, Splitting Neighbors in West Bengal

VOANews quotes:

Tata's problems in West Bengal are scaring off other industries hoping to locate here, including Infosys, a software maker that wants to build a business park that would provide 5,000 jobs.
Kartik Chandra Malik, 57, runs a tea shop near the boundary wall of Tata's Nano factory.
He says he is frustrated that the factory has been stopped. He says wants it to open, because when it is open he can do more business selling tea and biscuits. He is hoping his son, who just graduated from college, will get a good job at the factory.
Many of Malik's neighbors in Barispada are tight-lipped when it comes to talking about Tata's troubles. There is growing tension in the villages near the Tata factory as the protests continue and the plant remains closed. The Tata crisis pits neighbors against each other.
Malik says many of his neighbors are being pressured by opposition groups to protest against the carmaker. But many here already have jobs lined up at the factory or hope to.
A young man at Malik's tea shop said he got a job loading trucks at the Tata plant. For that, many of neighbors have called him a traitor.

Guinness Book of World Records IBN mentioned:

The ambitious Nano car has not rolled out of the assembly line of the makers Tata's plants yet. But it is already in the Guinness book as the world's cheapest car.

Comparison with Model T Some news-sources have compared Ratan Tata's Tata Nano with Henry Ford's Model T that co-incidentally was built around a century ago. Livemint said:

Ford Motor Co. is rich because Henry Ford used the assembly-line to produce the Model T in 1908. Ratan Tata is a late entrepreneur, making the Nano in 2008.
India is 100 years behind. But we are waking up to the possibility of catching up. I just hope our planners wake up soon.

Times of India mentioned:

This raises the question: How have the Tatas accomplished such a task? Pursuing this question a fascinating story unfolds that reminds one of Henry Ford's Model T that was built exactly one hundred years ago (September 1908). Ford wanted to make a car for the multitude, not for the elite, with the best material and the best design that the technology of his time could devise, and he wanted to make it, above all, at a price that was affordable. This is the example that Ratan Tata has followed with determination. When he announced the price of his car in an interview to the ‘Financial Times’ during the Geneva Motor Show, his colleagues were 'aghast', but he had set his goal.

Technical specifications

According to Tata Group's Chairman Ratan Tata, the Nano is a car with a 623 cc rear engine and rear wheel drive, and has a fuel economy of 4.55 L/100 km (21.97 km/L, 51.7 mpg (US), 62 mpg (UK)) under city road conditions, and 3.85 L/100 km on highways (25.97 km/L, 61.1 mpg (US), 73.3 mpg (UK)). It is the first time a two-cylinder non-opposed petrol engine will be used in a car with a single balancer shaft. Tata Motors has reportedly filed 34 patents related to the innovations in the design of Nano, with powertrain accounting for over half of them. The head of Tata Motors' Engineering Research Centre, Girish Wagh has been credited with being one of the brains behind Nano's design.

Though the car has been appreciated by many sources, including Reuters due to "the way it has tweaked existing technologies to target an as-yet untapped segment of the market", yet it has been stated by the same sources that Nano is not quite "revolutionary in its technology", just low in price. Moreover, technologies which are expected of the new and yet-to-be-released car include a revolutionary compressed-air fuel system and an eco-friendly electric-version, technologies on which Tata is reportedly already working, though no official incorporation-date for these technologies in the new car has been released.

According to Tata, the Nano complies with Bharat Stage-III and Euro-IV emission standards. Ratan Tata also said, 'The car has passed the full-frontal crash and the side impact crash'.. Tata Nano passed the required 'homologation’ tests with Pune-based Automotive Research Association of India (ARAI).This means that the car has met all the specified criteria for roadworthiness laid out by the government including emissions or noise & vibration and can now ply on Indian roads. Tata Nano managed to score around 24 km per litre during its ‘homologation’ tests with ARAI. This makes Tata Nano the most fuel efficient car in India. Nano will be the first car in India to display the actual fuel mileage figures it recorded at ARAI’s tests on its windshield. According to ARAI it conforms to Euro IV emission standards which will come into effect in India in 2010.Rear mounted engine The use of a rear mounted engine to help maximize interior space makes the Nano similar to the original Fiat 500, another technically innovative "people's car". A concept vehicle similar in styling to the Nano, also with rear engined layout was proposed by the UK Rover Group in the 1990s to succeed the original Mini but was not put into production. The eventual new Mini was much larger and technically conservative. The independent, and now-defunct, MG Rover Group later based their Rover CityRover on the Tata Indica.

Tata is also reported to be contemplating offering a compressed air engine as an option

Engine:	2 cylinder petrol with Bosch multi-point fuel injection (single injector) all aluminium
	Value Motronic engine management platform from Bosch
	2 valves per cylinder overhead camshaft
	Compression ratio: 9.5:1
	bore × stroke: ×
	Power: @ 5500 rpm
	Torque: @ 2500 rpm
Layout and Transmission	Rear wheel drive
Layout and Transmission	4-speed manual transmission
Steering	mechanical rack and pinion
Performance	Acceleration: 0-: 14 seconds
	Maximum speed:
	Fuel efficiency (overall): 20 kilometres per litre
Body and dimensions	Seat belt: 4
Body and dimensions	Trunk capacity:
Suspension, Tires & Brakes	Front brake: disc
	Rear brake: drum
	Front track:
	Rear track:
	Ground clearance:
	Front suspension: McPherson strut with lower A arm
	Rear suspension: Independent coil spring
	12-inch wheels

Supplier	Product
Bosch	Gasoline injection system (diesel will follow), starter, alternator, brake system
Caparo	Inner structural panels
Continental AG	Gasoline fuel supply system, fuel level sensor
Delphi	Instrument cluster
Denso	Windshield wiper system (single motor and arm)
FAG	Rear-wheel bearing
Ficosa	Rear-view mirrors, interior mirrors, manual and CVT shifters, washer system
Freudenberg	Engine sealing
GKN	Driveshafts
INA	Shifting elements
ITW Deltar	Outside and inside door handles
Johnson Controls	Seating
Mahle	Camshafts, spin-on oil filters, fuel filters and air cleaners
Saint-Gobain	Glazing
TRW	Brake system
Ceekay Daikin/Valeo	Clutch sets
Vibracoustic	Engine mounts
Visteon	Air induction system
ZF Friedrichshafen AG	Chassis components, including tie rods
Behr	HVAC for the luxury version

Variants

Besides the regular and conventional gasoline-variant (expected to be released in 2008 alongside the electric-variant), the following variants are also expected:

Diesel

Together with Diesel Engine specialist FEV Tata Motors is developing a 684 cc diesel engine for the Nano. It was earlier reported by media that Tata was producing an 800 cc Common Rail diesel engine.Diesel Variant will be available in September, 2009. Diesel variant Nano will sell for Rs2 lakh (200,000 rupees). Nano will have the smallest Common Rail Turbocharged Diesel engine in the world and is expected to deliver steering fuel economy figures.

Eco-friendly variants and initiatives

Tata Motors is reportedly working on some very revolutionary and eco-friendly initiatives, some of which are personally-supported and appreciated by Mr. Ratan Tata. Other than their Gasoline engine, Tata Motors will offer following options:

Compressed-air engine

Tata Motors is working with a French firm on using compressed air as fuel which is eco-friendly and revolutionary in itself for a car of such large-scale. The company has tied up with Moteur Development International (MDI) of France for this purpose:

Electric drivetrain or electric-version

Tata is also believed to be making an electric version of the Nano (reportedly with attached or sideby solar panels as well) which might prove to be a boon for the society and the world, both in terms of cost and technology, as it might well turn out to be the "world's cheapest electric car which is more eco-friendly and has many enthusiasts and media for its support. It's supposed to be as cheap as the conventional gasoline version. Tata is making the Nano compliant with export market regulations and plans to export such a car world-wide, particularly to the UK and the rest of continental Europe, the US, and Australia.

Economic Times reported that the "electric Nano" "would still make good sense for economic, clean and green personal mobility in countries around the world." According to the Hamburg-based newspaper, Auto Bild, the E-Nano would be built in cooperation with the Norwegian electric car specialist, Miljoebil Grenland or Miljøbil Grenland AS.Enthusiastic support Tata Motors received preliminary enthusiastic-support in the media as well as in government circles (including Europe and other states) for the electric-variant of Nano. The enthusiasm is reportedly even higher than that for the petrol-variant.

The Hindu quoted European Commission’s Director General for Energy and Transport, Matthias Ruete, as saying:

I can say that alike other nations, entire Europe is also eagerly awaiting the commercial launch of Nano. But keeping in mind the adverse impact of carbon dioxide (CO²) on environment, it would be advisable to have Nano’s electric version. I hope Tata (Ratan) is working on it.

Hybrid

Some news-sources state that "a hybrid version [of Tata Nano] is also likely, although it is not yet known whether the electric motor will be paired with a gasoline or diesel version. Other sources also favored it and argued that "India needs needs Tata Prius [similar to Toyota Prius] and not Tata Nano.

Trim levels

The Nano will be available in three trim levels:-

Standard
Deluxe
Luxury

The base $2,500 getting no air conditioning. The Deluxe and Luxury variants will get AC and body colored bumpers. Luxury variant will also have alloy wheels, fog lamps and ICE. Tata Motors plans to sell more expensive version in order to keep product line profitable.Picture depicting Tata Nano's Variants, Trim Levels, Interiors and Dimensions.

Singur factory pullout

Singur car factory land dispute arose as Tata's planned manufacturing unit for the car in, Singur, where the state government of West Bengal had allocated to Tata Motors. The construction of the car factory on that tract of land began in January 2007 on fertile agricultural land and the expropriation and eviction of approximately 15,000 peasants and agricultural workers. The affected farmers have fears that they will receive inadequate or no compensation and therefore lose their livelihoods.

Activists near Kolkata, where Tata's manufacturing unit is located, burnt the car effigy. In New Delhi, a group of six women protested wearing T-shirts bearing slogans that said, "The Rs 1 lakh car has Singur people's blood on it." The Trinamool Congress alleged that Tata motors usurped the agrarian land for the construction site and have threatened to stall the manufacture of the car.

With the Tata Nano project in jeapordy in West Bengal, there is now a race between other Indian States to become the new location for the Tata Nano project, with each state trying to entice the Tata Motors Group to their particular location..

Relocation and pullout

On 2 October 2008, Ratan Tata officially announced that Tata Motors is pulling the Tata Nano project out of Singur and "evaluating options from Maharasthtra and Gujarat," as well as Karnataka to relocate the plant and machinery. The move is said to put up to Rs 80,000 cr at stake because there is no guarantee that Trinamool Congress would not be further emboldened by their success against the Tata's to launch similar agitations against land acquisition for other industrial ventures. Narendra Modi's business-friendly Gujarat, of which Tata once commented "your stupid if you not [In Gujarat]," is said to be a leading option.

Ratan Tata announced on Oct. 7, 2008 that he is going to move his plant to Sanand in Ahmedabad district of Gujarat.

Admitted mistake(s) in land-acquisition

In an interview, Ratan Tata finally admitted: "I take the responsibility (for the Singur issue). They offered us the land in Kharagpur. We would have gone there. But, I rang up Buddhadev."

As early as January 2008, Trinamool Congress had demanded a white-paper for the plant, and Forward Bloc leader Ashok Ghosh had asked Tata Motors to close their Singur plant within a year. He had termed the decision to allow the car plant at Singur a "mistake", and had asked the state government to take corrective steps. However, Tata Motors is now being criticised for not paying requisite attention to this issue at this early-stage only when the plant could have been easily shifted as not much investment had been done.

Moreover, in West Bengal Chief Minister Buddhadeb’s own words, the acquisition of the land for the Singur plant has been a ‘mistake’. It is alleged that Tatas did not pay enough attention towards setting up plants in other competing states, such as Uttarakhand and Uttar Pradesh, even though then Chairman of Uttar Pradesh's Industrial Development Council, Amar Singh, himself had invited the Tatas for setting up the plant in Uttar Pradesh in 2006 (see below).

Comments by politicians

On 21 September 2008, West Bengal Chief Minister Buddhadeb Bhattacharjee ultimately said, "The project will go out of West Bengal, if there is further delay. Therefore without any more loss of time Tata Motors and ancillary units should be allowed to work at Singur. I appeal to the opposition parties to accept the government's package on the land acquisition at Singur for the Tata Motors factory and withdraw the agitation. If there is further delay, this project will leave West Bengal. External Affairs Minister Pranab Mukherjee said, “If a group like the Tatas leaves West Bengal it will be unfortunate … a major setback to industrialisation in the State.” However, on 22 September 2008, Mamata Banerjee (politician), virtually unperturbed by the warnings, threatened to resume her agitation again, asking indifferently for return of or more, instead of 70 acres that the government offered. According to The Times of India:

Mamata is sticking to her land-for-land demand, hoping that her stubborn stand will yield electoral dividends in rural Bengal it doesn't matter if Tatas exit Singur. Even her own colleagues in Trinamool have got fed up and are equally frustrated with didi's arrogance but they don't dare go against her. "I am fed up. Let the Tatas do whatever they want. The war of nerves is getting too much," a senior Trinamool leader said.
The rumblings, however, make no difference to Mamata. Her eyes are fixed on Writers' Buildings, and not the small car factory.

Mamata Banerjee of Trinamool Congress has reportedly been "voicing provocative speeches to instigate Trinamool supporters to cause vandalism in Singur", to improve her public-image and to get popularity for winning elections. As of today, even if she resolves the issue immediately, the whole project would have been delayed by one month or more, causing unaccountable harm to Tata's image as well as harming West Bengal and Tata Motors economically and irrepairably because, though the car might release in 2008, yet the Tata Motors would probably miss the 2008 festive-season deadline that it had set for itself.

Failures

Of talks "The talks between West Bengal Chief Minister Buddhadeb Bhattacharjee and Trinamool Congress chief Mamata Banerjee on Friday evening to settle the Singur imbroglio failed to bring out any positive results," Economic Times as well as others reported.Of "package" The "package" initially offered by Tata Motors was rejected due to which the land-dispute resulted. Again, an updated "package" was rejected and criticised as "unfair" by the people. News-sources mentioned that the offer to get 50% more assistance for land-losers is simply not enough.Of Singur plant IBNLive reported:

Initially, it was being presumed that Singur would be delayed and the first Nano would roll out from some other Tata factory. Now it appears that Singur might lose the project completely.

The Telegraph reported: "It is believed that the Tatas have told the government they will wait till September 22, the last date for registration of beneficiaries of the package".

Reactions from business-people

Whilst the business community within India is upset about the whole episode, having advised Tata Motors to relocate either to Pantnagar or a nearby facility in Uttar Pradesh, the NRI business community neither seems afraid nor concerned. Lakshmi Mittal of ArcelorMittal said: "Whilst India has been a big part of my past, it is sure to be a big part of all our futures. It does not give us nightmares. And we will not revisit our plan in India because of Singur episode. Indra Nooyi of PepsiCo also added, "We have a plant in Kolkata, and it is functioning well. We are bullish on India, and we like our business in Kolkata. I do not have an opinion on the matter (Singur controversy). It is for the company and state government to sort out.

Aftermath

No land-return West Bengal Industry Minister Nirupam Sen has said that there was no legal provision under which the state government could return land to the farmers. This could result in lack of livelihood to protesting farmers and would become an utter failure for Mamata Banerjee (politician) and her Trinamool Congress political-party who opposed Tata's plant. Sen said:

On the issue of returning the acquired land, we hold that there is no such provison in the Indian Constitution. The present owner of the land is the state government. There is no legal provison by which one can return the land to the farmers or to the previous owners. There is really no need now more than ever to enter into any dialogue with the opposition any longer. The court of law shall hold onto the cheques of those who had not accepted them for whatever reasons. Tata pullout has harmed industrialisation in the state. Politics would never allow any good to happen to Bengal. Trinamool Congress wanted exactly this to happen -- let blood be shed. The blood letting they would utilise shamelessly for political ends.

Corporate Rivalry

Tata Nano was envisioned as the four wheelers for those who can only afford two wheelers, due to its affordable price Nano's impact on two wheelers sales has been widely debated, Nano will also affect sales of higher priced Cars or will motivate competitors to reduce the prices resulting lowered margins for rest of the industry.

Due to Longevity of the protest by Trinamool Congress, many people in the media have hinted that rival Corporates have funded and provided logistics for TMC's protest to Sabotage the Nano project so that its launch can be delayed and costs can be increased. In a single day of the protest, food bill alone ran into millions of rupees.

It has been speculated that money to sustain such a prolonged protest involving thousands of TMC party workers came from rival Two/Four Wheeler lobby. Rahul Bajaj gave an interview in which he lauded Mamta Banerjee's effort and stated that what she is doing is for the welfare of poor farmers, Rahul Bajaj is the owner of Bajaj Motors which is a leading two wheeler manufacturer. Bajaj Motors is also developing a low cost car together with Renault-Nissan to rival Tata Nano . In a debate show organized by NDTV a leading Business Magazine's editor in chief hinted that Bajaj Auto is financing Mamta Banerjee. After the telecast of this debate Rahul Bajaj denied the allegations and threatened to sue the editor of Businessworld magazine for defamation.

Mamta Banerjee's reaction towards the relocation package by West Bengal government also gave fuel to these theories. West Bengal government offered land to the displaced farmer nearby Tata Motors plant, Mamta Banerjee's refused to accept the package and asked for the land inside the project area to be returned.

Plant(s) and proposed manufacturing facilities

Nano will be produced at the Mother PLant in Sanand, Gujarat and the Satellite plant at Pantnagar where assemply lines of Ace Truck have been modified to produce Nanos.

Singur was envisioned as the mother plant supplying to various satellite plants in various regions all over India but now that Tata has made a soft exit from West Bengal it is believed that they will have a mother plant in state which will provide maximum incentives and also has least potential for controversy in land acquisition. Availability of cheap labour will also play a major role in this decision. At the same time the PantNagar plant is manufacturing Tata Nanos in small batches of 25-50 and it is expected that this number will be increased to 500 per day. After meeting West Bengal chief minister Buddhadev Bhattacharya Ratan Tata announced Tata Motors decision to pull out from Singur due the lack of security of their employees in the region.

After pullout from Singur Tata Motors decided to setup mother plant in the state of Gujarat due to proximity to major ports like Mundra and cities like Rajkot where 30% of Nano's components are manufactured and the the proposed plant site is fully owned by the Government therefore there will be no issue in land transfer. Gujarat state is also known for Gujarati's positive attitude towards businesses.

It is not yet known when the first batch will be produced at the Sanand plant, meanwhile Tata Motors is producing Nano at its plant in Pant Nagar and Pune to meet its deadline for the launch.

Criticism, issues and problems

Questions of safety

The Times says:

India has 8 per cent of the world’s vehicle fatalities and less than 1 per cent of its cars, with more than 90,000 people killed on the country’s roads every year. Introducing a million Nanos into the mix may bring more – and unwelcome – headlines.
Tata, which has the only crash-test facility in the country, said that the Nano “exceeds current regulatory requirements”. And while it is not a deathtrap – it has crumple zones, seat belts and strong seat anchors – it is worth bearing in mind that total vehicle crash testing (rather than just frontal impact), airbags and antilock braking systems are not mandatory.
Without these, the Nano would not even be considered for approval in Britain. Adding them would double its price in India, which is why they have been omitted.

It's believed that Tata Motors will offer a version of the Nano with these safety-features, including an airbag system in its electric version. Tata said the Nano has an all sheet-metal body, with safety features such as crumple zones, intrusion-resistant doors, seat-belts, strong seats and anchorages, and the rear tailgate glass bonded to the body. Tires are tubeless.

Mass motorization and climate change

As the Nano was conceived and designed around introducing the automobile to a sector of the population who are currently using eco-friendly bicycles and motorcycles, environmentalists are concerned that its extraordinarily low price might lead to mass motorization in countries like India and therefore possibly aggravate pollution and global warming as well as increase the demand for oil. Rajendra Pachauri, an Indian and chairman of the Intergovernmental Panel on Climate Change, said he was "having nightmares" because of this car and added that the car represents bankruptcy of India's environmental policy. The ecology focused German newspaper die tageszeitung feels that such concerns are "inappropriate" as the Tata Nano has lower emissions compared to the average Volkswagen, and that developing countries shouldn't be denied the right to motorized mobility when industrialized countries should be looking to reduce their emissions and usage of cars. Die Welt reports that the car conforms with environmental protection, and will have the lowest emissions in India.

In crowded metropolitan cities like Mumbai, Ratan Tata has conceived a scheme to only offer the Nano to those individuals who do not have an automobile already. The Nano will also replace many overloaded and worn-out two-stroke polluting vehicles, both two and three-wheeled. In the current policy and regulatory framework, Centre for Science and Environment consider that the economy cars will be disastrous.

However, this can change if eco-friendly variants (cited above) are manufactured, instead of the conventional petrol and diesel based versions.

Used car market effects

The Nano is alleged to have severely affected the used car market in India, as many Indians opt to wait for the Nano's release rather than buying used cars, such as the Maruti 800 (a rebadged Suzuki Alto), which is considered as the Nano's nearest competitor. Sales of new Maruti 800s have dropped by 20%, and used ones by 30% following the unveiling of the Nano. As one automotive journalist summarises; “People are asking themselves – and us - why they should pay, say, 250,000 Rupees for a Maruti Alto, when they can wait and get a brand new Nano for less in a few months’ time, a car that is actually bigger”.

Competitors

India's recent cut in excise tax small cars has encouraged several manufacturers to draw up plans for small cars.

Bajaj Auto

Bajaj Auto-Renault-Nissan ULC (no prototype has yet been presented)

Bajaj Auto says its $2,500 car, which it is building with Renault and Nissan Motor, will aim at a fuel-efficiency of 30 km/litre, or twice an average small car, and carbon dioxide emissions of 100 gm/km.

The Bajaj venture will have an initial capacity of 400,000 units, while Tata expects eventual demand of 1 million Nanos.

Others

Rival car makers including Fiat, General Motors, Ford Motor, Hyundai and Toyota Motor have all expressed interest in building a small car that is affordable to more middle-class consumers in emerging markets. The bulk of demand there is for small cars because people are much more sensitive to fuel prices.

Honda and Toyota are leading the way on so called cleaner gasoline-electric hybrids, and some environmentalists argue getting prices down on these technologies is where efforts should be concentrated.

Inexpensive and eco-friendly electric-cars like Tara Tiny (reortedly even cheaper than Tata Nano) and REVA pose even more significant danger to Nano.