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Home > Business > Special



'One-lakh car' takes populist road

Jo Johnson | January 11, 2008

For many attending the Delhi Auto Show, Thursday's chaotic launch of Tata Motors [Get Quote] "one-lakh car", billed as the world's cheapest, was a foretaste of the anarchy to hit Indian roads. A miscalculation of the number of delegates and media people wanting to witness automotive history in the making resulted in a dangerously overcrowded venue and the type of scrum typically found at the subcontinent's cricket stadiums.

"This is terrible," groaned Kazuya Osakada, a mask-wearing journalist from Japanese public television, as he waited for Ratan Tata, the chairman, to speak at a press conference. "No organisation at all."

Forced to sit, sullying his suit, on the floor of a room a third the required size, he looked doubtful that a company capable of such poor planning could have just pulled off a feat of extraordinary engineering discipline.

It was confirmed on Thursday that the pre-tax version of the people's car, to be branded the Tata Nano, will sell for Rs100,000 ($2,550, pound 1,300, euro 1,700) when it hits showrooms this year, as pledged five years ago when the project was launched. "A promise is a promise," said Mr Tata, 70, who helped with the design. Surprisingly spacious, the car has the potential to bring motoring to a mass market in this country of 1.1bn.

Sparing his audience no hyperbole, Mr Tata said the Nano was a landmark in the history of transport, likening it to the first powered flight by the Wright brothers and the first lunar landing. For its detractors, however, the petrol-powered vehicle is a missed opportunity for India to leapfrog a technological generation. It will also worsen conditions on clogged roads and send critical pollution levels soaring.

Interrogated by a foreign journalist who had spent an hour and a half travelling 10 miles through the capital's heavy traffic to attend the launch event, Mr Tata admitted there was a "desperate" need for investment in mass transit systems. He said he would be concerned if the Nano "created absolute chaos across India", adding that it was not the company's aim to sell "millions" of vehicles.

"But should the masses be denied individual forms of transport and made to stay as they are?" he continued, to applause. Although he said Tata Motors "made no claim to have made the most eco-friendly car in the world", he pointed to the car's fuel-efficiency, noting it would achieve more than 20km per litre with its 0.62-litre engine and meet Indian and European emissions standards.

While environmentalists gloomily forecast that it would come to be known as "the car that ate India", many Indian industrialists, including Tarun Das, chief mentor of the Confederation of Indian Industry, see the Nano as a godsend for the Indian economy. Such entrepreneurial verve, they say, will boost the confidence of Indian industrialists long overshadowed by China's manufacturing prowess.

"It's a revolution," said Mr Das, noting the involvement of 100 suppliers in the indigenously developed vehicle, which has spawned 34 patents. "What it proves is that you can do R&D in India. For a business community that has all been used to going down the joint venture route, the one-lakh car is going to be inspiration. I think it will be manufactured around the world. With a three- or five-year loan, anyone can afford it."

The basic version, which lacks air conditioning and has only one wing mirror and a single windscreen wiper, will cost half the price of a Maruti [Get Quote] 800, the cheapest car now on sale in India, and little more than a high-end motorbike.Tata plans also to sell the Nano in Latin America and Africa.


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