Given that we’re all living through one of the worst economic times since The Great Depression, it seems that money pinching and budget tightening has become the new fad these days.
So when the topic of purchasing a cheap car surfaces, there aren’t a lot of manufacturers that can offer more for less than the Tata Nano.
With a price tag that comes up to only $2,200 in India, including taxes and fees, the Tata Nano – not to be mistaken for the Macintosh MP3 player - is becoming the latest must-have car of the cash-strapped man.
While it doesn’t look the least bit imposing, the Nano is still less than a quarter of the next set of cheap cars you can find anywhere.
After all, when you strip down the essentials of a car, the most obvious need is for you to be able to get to Point B from Point A, which after all is what we’re all looking for, right?
The Tata Nano is definitely not the kind of car that catches a lot of buzz. However the Pr1ma Concept, revealed at the Geneva Motor Show, is. With this concept Tata Motors has taken a huge step forward. The vehicle was designed by Pininfarina, and offers an indication of how the next generation of Tata saloons might be interpreted. The focus is on the distinctive, elegant design.
Conceived to provide a luxurious level of comfort, this 4-door has a straight-forward but very refined design. All this combined with twisting lines give the car the personality of a coupe. It is a solution that immediately adds value, compared to the basic essential design usually associated with the Tata brand.
The Tata Pr1ma addresses a higher segment of drivers; the external and internal measurements are larger than those of the Indigo, thanks in part to a longer wheelbase. The design balances fluidity and tension, and the result is an elegant look, that manages to be both classic and modern. This type of creation is what the Indian automaker needs to elevate themselves to the next level of automotive manufacturing. You may even see them popping up here in the U.S.
Tata was not messing around when it said that the protests at the Nano plant may make it go elsewhere. Yesterday Tata announced that is was stopping construction on the plant in Singur, a farming community in West Bengal state in India. The company said in a statement, “This decision was taken in order to ensure the safety of its employees and contract labor, who have continued to be violently obstructed from reporting to work.” The center of the problem is the 400 acres of farmland that was taken for the factory grounds, and the farmers that want it back. This represents a large setback to the world’s cheapest car considering the plant construction was near completion and employed about 4,000 people so far.
Now the Nano is now shopping for a new home. There is no word on how this setback will effect production schedules or possibly the price of the $2,500 car.
Tata Nano was supposed to be the cheapest car in the world. People should have been thrilled about it, but not everyone is so cheery.
Tata was supposed to build the Nano at the plant in the Singur area of India. That was before it has been blockaded by farmers who have decided not to cede 162 hectares of terrain destined for factory expansion. The West Bengal government hasn’t reached an agreement with the workers, and it decided not to use force to prevent the protests. Given the situation, production has been stopped. Tata has threatened the local government with moving production to other areas if a solution cannot be reached in the near future.
Tata is getting the attention of the world with its micro car called the Nano. The Indian company has also gained a worldwide distribution network with its acquisition of Jaguar and Land Rover. Its distribution is further enhanced if it sells Nanos through Fiat. With all of this, it looks like Tata may be setting the stage to become a world brand.
If this is true, what else does it have to offer? Tata may have given a glimpse at what is available with the launch of the Indica Vista at home this week. For a little more than the price of two Nanos (under $6,000 at current exchange rates,) Tata customers can get a car that’s over two feet longer and eight inches wider than the Nano.
Powering the Indica Vista will be either a 75 hp diesel or 65 hp gas engine. While this kind of small power isn’t something that lends itself to the U.S. market, this may be in line for Europe. If the Indica could meet Euro NCAP safety regulations, this would be a car that may have potential. For example Proton, a Malaysian company that also owns Lotus, sells a small car called the Savvy in Europe. While this is considered a bargain basement car, it is similar in specifications to the Indica but costs about 1000 pounds more.
Is all this speculation? Mostly. But what can’t be ignored is the desire for companies to grow, and this may be the next Tata to be given to the world.
The October production of the Tata Nano, a $2,300 mini-car, may be slowed or halted due to violent protests at the new Singur, West Bengal plant. Eruption of protests began after Tata build a $350 million plant on the site of fertile farmland. The West Bengal state government provided Tata Motors with 1,000 acres for the factory, which they brought from local farmers. Some farmers refused to sell and are demanding the return of their land.
The increasing amount of violence is concerning Tata, so much so that the Indian automaker is considering completely abandoning the site. “What has concerned us is the violence, the disruptions, that has led us to be concerned about the safety of our employees, our equipment and investment, and of the viability of the process,” said Chairman Ratan Tata “If anybody is under the impression that because we have made this very large investment of 1,500 crore rupees ($350 million), that we would not move, then they are wrong, because we would move, whatever the cost, to protect our people. I can’t bring our managers and the families to West Bengal, if they’re going to be beaten, if there is going to be violence constantly, if their children are going to be afraid to go to school.”
Rumors and even some confirmed reports are going around tying together Chrysler, Fiat and Tata. Starting in the U.S., Chrysler may partner with Tata to sell Jeep Wrangler’s to the Indian market. What is alarming about this plan came from an investment banker watching the deal. "You could definitely see this evolve into something," the banker said. "It would make sense for Tata to buy Jeep if this partnership went through ... and Chrysler could really do with selling a brand and getting some cash." Jeep, America’s brand for sale! Say it ain’t so Chrysler.
Chrysler also has extra manufacturing capacity from the SUV sales slowdown, and Fiat may lease factory space to bring production to the U.S. This may also tie Chrysler’s dealer network into the possible return of Fiat brands including Alfa Romeo.
Fiat and Tata are already attached to a deal that will have Fiat provide
financing for Jaguar and Land Rover, In return, Fiat would possibly sell the Tata’s ultra-economy Nano in Europe.
In a way, this could set up Lee Iacocca’s “Global Motors” dream of over 30 years ago. Iacocca thought about bringing together an American, European, and Japanese car company to make a worldwide automotive conglomerate. The idea allowed for utilizing the U.S.’s manufacturing strength, European style, and Japanese knowledge of good economy cars. Although Tata is not Japanese, the Indian firm is looking to show the world it knows how to make an inexpensive car. So, if all this goes through, someone better build a chart to keep track of what car is coming from where.
Although Daimler is the name of Mercedes-Benz’s corporate parent, it is also a prestigious English car brand. Tata acquired the rights to this brand when it bought Jaguar. At one time Daimler made its own separate cars, but for the last forty years, Jaguar has mainly used the Daimler name for ultra-low volume premium versions of the XJ cars and aristocratic limousines. Now Tata may use this name to give Jaguar it own ultra-premium brand in the same way Mercedes has Maybach or BMW has Rolls-Royce.
The quick history of the brand is that at the end of the 19th century, a British company acquired the local rights to sell engines developed by German engineer Gottlieb Daimler, under his name. British Daimlers became competitive in racing and the preferred transportation for British royalty. By 1960 it was acquired by Jaguar, and British Motor Company acquired Jaguar a few years later. Since then Daimler has lived on mainly as a company that sells thinly re-badged Jaguars at a premium price. Meanwhile, Gottlieb Daimler’s own company, over a succession of merges, became the present-day Daimler AG, the parental conglomerate of Mercedes as well as other vehicle manufactures. As an interesting note, when DaimlerChrysler divested Chrysler and wanted to call the company only Daimler, they had to get permission from Ford who acquired rights to the name when it bought Jaguar.
It’s small, it’s cheap, and now it may carry a Fiat badge. The Italian auto conglomerate may sell Tata’s ultra-low price Nano outside of the car’s home market in India.
The partnership would likely be forged because Fiat’s strong international distribution, and Tata’s desire to keep the Nano’s price low through more sales. Both parties have shown interest in the idea, but it’s not a done deal yet. Fiat Chairman Luca Cordero di Montezemolo said the company was in talks with Tata about making buses and trucks. "We’ll see if there are the conditions for us to go forward." In India, Fiat already has a joint venture with Tata to make and distribute cars, engines and commercial vehicles.
If Fiat were to get a version of the Nano, it would likely have to add more safety features to meet the requirements of most Fiat’s established markets (not the U.S.). This could mean added weight and cost to the $2,500 Nano, but it will take a lot to get this microcar out of people’s price range.
Tata is taking steps to makes sure the little Nano won’t be short on power. FEV, a German engineering and powertrain firm, is right now actively working on the diesel engine for the Nano to debut later next year. The 800 cc, turbocharged CRDI engine would most likely be the tiniest engine with common rail technology in the world, taking the crown from Daimler.
The CRDI systems are being developed in conjunction with Bosch, while Honeywell Turbo India is working on the turbo charger. Originally the 700 cc CRDI engine, which Tata uses in its Ace mini-truck was considered for the Nano, but Tata has decided against it. The new FEV engine is cheaper and could also involve more progressive technology to battle emissions, redeem a better fuel economy, and achieve better engine refinement.