World's Cheapest Car Hits Indian Streets

by VR Sreeraman on Jul 17 2009 2:02 PM

The world's cheapest car, the Tata Nano, is set to hit India's streets, as the first customer gets the keys to a vehicle that its makers hope will transform travel for millions of people in the country.
The head of Tata Motors, Ratan Tata, was to deliver the first car in person at a central Mumbai dealership on Friday, the company said. No details were immediately available about the recipient or the type of Nano being delivered.

But analysts said the delivery was a positive step, after a land dispute forced the firm off the site of a factory it was building to produce the cars in eastern India, fuelling concerns about its ability to meet demand on time.

"I think it's very significant," the associate editor of trade magazine Autocar Professional, Darius Lam, told AFP.

"They have been talking about delivering this car since last year and subsequently due to the problems they have had with moving the factory they have had to delay it by at least one year.

"It really shows that now they are getting their production in hand and are able to start delivering."

Some 100,000 people were selected from a ballot to be the first recipients of the Nano, which reviewers have compared to the European Smart car and the classic "People's Car", the Volkswagen Beetle.

They include a roadside cobbler from Mumbai, who had been saving for seven years to buy a two-wheeler, but decided to wait and upgrade to four wheels on hearing that the vehicle would sell for just 100,000 rupees (2,055 dollars).

Others among the 203,000 people who placed orders included an 82-year-old former assistant commissioner of Mumbai police who used to ride a scooter and a market trader looking for an investment for his 12-year-old son.

India's first female photo-journalist, Homi Vyarawalla, who is now in her mid-90s, has also bid for a car.

Ratan Tata launched the Nano in March, predicting the no-frills vehicle would revolutionise travel for millions of Indians, getting the growing middle-class, urban population off motorcycles and into safer, affordable cars.

Three versions of the sporty, jellybean-shaped Nano went on sale in April: the basic model and more expensive CX and LX models, which have extra features like air-conditioning, automatic windows and central locking.

The standard model sells for 140,000 rupees in the showroom. The deluxe models cost up to 185,000 rupees.

Tata Motors, part of the tea-to-steel Tata Group conglomerate, is India's top vehicle maker but like many firms in the automotive sector has been hit by the global economic slowdown which has cut demand for trucks and cars.

Last month it posted its first consolidated full-year net loss in eight years, partly blamed on a slump in sales at luxury British carmaker Jaguar Land Rover, which it bought from Ford last year.


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