Tuesday, February 15, 2011

Nano - bust or boom?

When I asked a friend from Rajasthan about whether he saw many Tata Nano's during a recent trip to Udaipur, Rajasthan, for his niece's wedding he told me that he only saw one and that people in the North (at least in his opinion) weren't buying them because they were too cheap. It wasn't their 'cheapness' in the way we perceive it that was the problem (as in poor quality leading to a lack of durability, frequent repairs and safety deficiencies) but, again in his opinion that their inexpensiveness meant that they didn't have the necessary cachet of a larger, more expensive vehicle (the Mahindra Scorpio for example).

I have seen quite a few of the cute little cars here in Kerala and it would certainly seem to make economic sense with fuel here being as expensive or slightly more so than it is in Canada (I think last time I went by a petrol station it was 62 Rs per liter - presently the exchange rate is about 44 Rs per $1 Canadian). The Tata Nano reminds me very much of the Mercedes Benz Smart car. For those of you who haven't seen one - here's an image of one I spotted in Chalai Bazaar (Trivandrum's main market).

A sunny yellow Tata Nano
 From a non-anecdotal point of view it seems as if the Nano has also been less than the revolutionary game-changer that was anticipated. This seems, according to this article, to be due to a combination of poor marketing, competition from other sectors (two-wheelers) and perhaps more than a pinch of smugness and overconfidence on the part of the Tata company.