TATA AUTOMAKER DISCARD ‘NANO’: WORLD CHEAPEST CAR

World Car News #Update

It was a moment of silence for the world’s cheapest car, Tata Nano, an almost 10 year old car which has all but died in India.

The Nano’s extinction was affirmed by production numbers, according to reports, Tata Motors Ltd. produced 1 unit in June, down from 275 in the same month last year. Exports were zero, versus 25 in June 2017. The company acknowledged that the car in its “present form cannot continue beyond 2019.”

The expiry of the “people’s car,” as Tata Motors branded it in 2008, holds lessons for automakers hoping to make it in India: While consumers may be value-conscious, cutting costs to the bone in pursuit of a gimmicky claim to fame is no use if the end result is a second-rate vehicle with a tendency to catch fire.

The Nano’s failure to sell stands in stark contrast to the rest of the Indian car market. From motorbikes to cars and trucks, growth in every segment is picking up. Passenger vehicles, including SUVs, jumped 38 percent in June. Commercial vehicles climbed 42 percent, while two-wheelers – which dominate the market – gained 22 percent.

Tata remains hopeful: A spokesman for the group said the Nano “may need fresh investments to survive.” Yet the evidence suggests that pursuit of the lowest price above all else was misconceived. A more realistic view is that India is squarely a high-volume, few-models game and consumers are focused on value – which means getting as many features as possible for their money.

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