The world's most affordable car, the Tata Nano, is likely to drive into the US by 2015. It is all set to take on the Western world with a few variations of the version sold in India. But will the Nano be able to steer away from the bumps in the US road, aka M&M, and not backfire given its current nil US retail network?
Tata Motors, which has been battling a global slowdown in vehicle sales and has reported a four per cent drop in September, including a drop in Jaguar Land Rover sales, has not let the slide in sales temper its ambitions for the Nano's release.
At a recent opening of a Jaguar Land Rover dealership in the US, Ratan Tata, Chairman of Tata Motors, said the car would be ready for the US market in three years and be priced below $10,000.
Abdul Majeed, Partner, National Automotive leader at PricewaterhouseCoopers (PwC), said: “With the acquisition of Jaguar Land Rover, they would be better off in an European country as far as distribution is concerned. Europeans have long been fans of small cars, because smaller tends to mean more fuel efficient.”
Tata Motors also needs to learn from competitor's mistakes. Though Tata has ceded place to rival Mahindra and Mahindra (M&M) in the last fiscal, with the latter selling four times as many SUVs as Tata in the domestic market, the company needs to take heed of M&M's bitter court battle with its US importer and distributor, Global Vehicles USA.
“If the Tata's want to become a global OEM (original equipment manufacturer), a firm presence in the North American market is vital. It is important to do that otherwise it will be extremely difficult to achieve the goal,” said PwC's Majeed.
In discussing the model's prospects to an auto magazine, Ratan Tata pointed to the popularity of small cars like the Mini Cooper and the Smart Fortwo, indirectly implying that the Nano's lower price tag would lure consumers. Nearest competitor in the US is the much larger Nissan Versa, currently the cheapest retailing at around $11,990.
amritanair.ghaswalla@thehindu.co.in
Keywords: Analysis, Tata Nano, US, Western world, variations, version sold in India, sales, US, Tata Motors, battling global slowdown, vehicle sales, four per cent drop, September,
Comments:
Congratulations!
Pls dont forget to perfect your model and engineering.
before you enter north America.
YCustomers are very picky in terms of any minor inconvenience like the belt-buckle-
mirror adjustments- navigation system- brakes-Tyre -traction -After sales service
-availability of spare parts- air bags- powered steering and mirrors-every detail to be
perfected.
Since the americans love to use in millions and easy to loose name and money
quickly.
Perfect the engine- & engage the best american -british-Italian- engineers to work on
well tested NANO prior to launching in usa. as per their standards.
Do not give any reason or doubt- contrary once the market goes by the word of mouth
and referrals then you are landed next it will hit south american market like wild fire.
since there are many mexicans and latin americans in usa who would love to use it
back in their country.
let it be a strong- value for money product - AFTER SALES S ERVICE is very
important.good luck.
US federal regulations cause a $3000 car to cost over three times as much. Does anyone really wonder why America isn't competitive? It's certainly not a mystery to me.
The Nano will need to meet USA EPA requirements. And smog requirements of California. And then the new miles per gallon requirements. The only logic of selling the Nano in the USA. 2015 is too far away and Nano may be too technically backward by then. TATA cars have a long way to go to compare against the Mini Cooper's technology. This i where size comparison is rrelevant.
A Re. 1 Lakh car turns out to be a Rs. 5 Lakh car. At $10K level people have several choices in NA. I hope Tatas have done their homework. NA is a tricky automobile market.
"US federal regulations cause a $3000 car to cost over three times as
much. Does anyone really wonder why America isn't competitive? It's
certainly not a mystery to me."
The increase in costs will be from things like increased engine size
(the current Nano tops out around 60mph), airbags, and structural
safety improvements. As for things like EPA and gas requirements, the
Nano already exceeds MPG standards and any improvement will likely not
impact that number greatly. Not to mention that the car has to be
shipped to America from India.
Without such improvements, the Nano would be a fiery death trap on the
American roads filled with gas guzzling SUVs, although I do believe
that adding too many improvements driving the price up will deter
first time buyers. Why buy a Nano when you can get a Kia or Versa for
less, especially at a year end sale?
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