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BW Businessworld

The Second Coming

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The Tata Nano is quite a feat of engineering. Almost no one would have believed that a car could be built that would sell for just over Rs 1 lakh in 2009. When the price tag was being talked about, quite a few rumours did the rounds. People wondered  whether the car would have a proper roof or a canvas one to save costs. And whether it would even have doors. The engine was supposed to be derived from two-wheelers. Until the car was actually shown to the public in the Auto Expo of 2008, there were all sorts of rumours swirling about the Nano because of its much-talked- about price tag.

The Tata Nano was probably one of the most-publicised launches in the history of automobiles. The Singur issue and the shift to Sanand in Gujarat and the heroic efforts to bring out the Nano on time was written about extensively in every newspaper and magazine.

The fact that the Nano was Ratan Tata's dream and the ultimate car for the bottom of the pyramid in the Indian market also gave it a sheen far beyond ordinary car launches. As a result, expectations about the Nano was skyhigh both within the company and outside.

Unfortunately, in the two years since launch, the Nano has been a bit of a damp squib in the market. It has crossed 10,000 cars a month volume just once in the 24 months it has been on sale. In most months, it has sold between 4,000 and 6,000 units. For a car that was expected to sell 1 million units a year (or about 83,000 units every month), this is a great comedown.

So was the entire Nano story all hype and little substance? Tata Motors doesn't think so. The top team at the company acknowledges that many things have gone wrong, but they still hold on to the dream of 1 million cars a year in sales. They have carefully discussed all the problems and are now trying to rectify them.

Executive editor Rajeev Dubey travelled to Mumbai and Sanand to meet Carl-Peter Forster, Prakash Telang and Girish Wagh to see what they were doing to revive the Nano. As he points out, this is a make or break effort for the company. If they fail this time around, the Nano story will go the way of the other celebrated automobile failure in history — the Ford Edsel.

(This story was published in Businessworld Issue Dated 01-08-2011)