No rift between Rover and Tata

Putting to rest rumours of an impending rift in the Tata Motors-MG Rover relationship, MG Rover has said that the two companies are now working towards making City Rover a more attractive package, offering better value for money.

MG Rover spokeswoman Suzanne Burtch told Business Standard that their recent round of talks concentrated on business plans to make the "package more attractive" in terms of "both pricing and the look and feel of the car".  An official statement reflecting this is expected soon.

Though periodical discussions on model upgrades and exploring new opportunities are a part of the original deal, the need to hold discussions at present is driven by poor sales.

"Sales of City Rover have not been as expected, so it is no surprise that the two companies are meeting to discuss future plans," added Burtch. The Rover team, which was in Mumbai till early this week is now back in the UK and they are now engaged in internal discussions.

City Rover faces stiff competition in the super mini segment from cars such as Fiat Panda, Toyota Yaris, Daihatsu Charade and Skoda Fabia. At pound sterling 6,495-8,895, City Rover is slightly more expensive than Fiat Panda (pound sterling 6,295-8,895). According to the last available reports, Rover sold around 4,800 units of the City in the October 2003-July 2004 period.

MG Rover and Tata Motors have signed a five-year deal for the export of 100,000 City Rovers over the period or an average of 20,000 Indica cars a year.

Tata Motors has shipped around 7,000 units of City Rover to the UK so far. Though shipments began in November 2003, there was a lull in the last few months when Tata Motors stopped exports. This was done to enable the company to meet domestic demand.