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What Went Wrong With The Tata Nano?


Tata Nano Art Side

Small cars always account for higher sales and volumes since their lower pricing leads to high demand. Not always though, case in point being the Tata Nano, which inspite of being the cheapest car available in the market today, fails to sell as much as cars five times the price. The Tata Nano is the only car in its segment and its pricing is such, there is no alternative even close. Still the sales of the Nano have been on a downward slide with 5491, 4004 and 3503 units being sold in September, October and November 2012 respectively.

So what went wrong with the Tata Nano? Well quite a few things. Although the product is fantastic, many incidents have made people believe otherwise. It all started with the positioning of the vehicle which was dubbed as the ‘world’s cheapest car’. Now who wants to own a product which is associated with words such as cheap? Not many. The Singur controversy lead to a massive delay and by the time the Nano hit the roads, the initial hype had subsided.

When Tata Motors launched the Nano, they already had a good amount of bookings, 3.2 lakh to be precise. Due to inadequate capacity, the company kept the initial order to 1 lakh units and chose the buyers through a lucky draw system. Once the company delivered 1 lakh Nanos, it re-opened bookings, hoping that many of the canceled bookings would return to purchase the car. Unfortunately for Tata Motors that never happened and the company wasn’t ready with a marketing campaign either.

So why did so many people who initially booked the Nano turn it down later? There are two good reasons, one being the massive delay in deliveries and second being the series of fire incidents, which created a perception in the minds of prospective buyers of the Nano being an unsafe vehicle. Tata Motors on its part could have been quicker to respond to the fire issues and should have cleared the air by immediately announcing a recall and reinstating confidence in the product.

Tata Motors has realized its faults and are now investing in marketing activities time and again. The company is also developing an upgraded version of the Nano along with various variants including CNG and diesel versions for a launch next year. The Nano’s primary market include rural and semi-rural areas, where the company did not put up a dealership network. Now the focus is to set up Nano exclusive dealerships in such places, where the Nano can be marketed to the target audience. The company is also looking at export markets to exploit the installed production capacity at its Sanand facility.

2012 Tata Nano Facelift

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  • No One

    Why this tall boy looks that to engine with similarities to an auto rikswa?

    People say, better to take bus, ride bike rather buying this modified auto rikswa !!!!

  • Rajan

    Rightly pointed teh two reasons for its non-accentance

    1. Tagged as “Cheap”
    2. Fire incidents

    The third reason is, even the dealers are not willing to push on Tata Nano because fo marginal profit.

    Of course, the media should be blamed as well. They created unnecessary hype by tagging it wrong with the word “CHEAP”. They are also the one which “reported nano on fire” incidents.

    On a different note, would it be same situation had it (Nano) come from Maruti/Hyundai for example? Remember how Maruti regained its Alto market status with teh K800. The brand TATA also matters.

    • http://www.motorbeam.com/ Faisal Khan

      Rajan, I don’t think blaming the media is appropriate. If there is a fire incident, they are bound to report on it. Tata should have ensured they resolved the issue once and for all.

  • aman

    i agree

  • Ben

    The nano’s boxy toy like design is the miserable one. The groung clearance is not good for indian conditions. finally the engine response is not good which made the nano fail. the rest of the resons are mentined in the article itself, no more to comment.

    • Anand

      Hi Ben,
      Your comment on the Ground clearance needs to be double checked. I drove a Nano through pot holed and deep pit roads and the ride was excellent. Later I understood that the Ground Clearance was around 180 mm which is as good as any Scorpio kind of vehicle.
      Please test drive the Nano. Don’t kill a product/ brand without data or experience.

  • atul

    people love to talk negative about nano. auto riksaw, cheap, low gc, this, that, etc etc…! nano can do 100 kmph with 5 on board can a auto do? and which auto have ac/heater in it? nano has 180mm gc. it is far more than any other car in india but some intellectual guys are finding it low.
    nano not cheap to run. if one can afford to run the nano he can afford to by a alto very well and this is what happening today. another reason may be that the tata brand has become too boaring by the design of its cars. indica, vista, aria all are loosing their grounds to rivals. nano is a victim of tata downfall too.

  • Robin

    The nano is a feat well achieved by TATA MOTORS. Enormous hrs of R&D have gone into the making to make it possible at that price range. Nt every company can do that. It was a great achievement and must be respected. And the driveability of the Nano is pretty good.

  • rengaswamy

    I own two nanos bought three years apart.there are nagging quality issues in the older version.my newer nano seems to be better built.Tata has poor R & D and customers are the crash test dummies….its probably somet hing to do with their Corporate culture…..all said apart,here is no other car like the nano in city driveability <60kmph,investment cost ,maintenance cost,airiness of cabin,space(me and my wife both are 6 feet),ground clearence is great.Breaks are pathetic,highway behaviour is poor,and problems happen at predictable lifespan but service is great!.
    My 2010 nano returns 29.5km/l on highways at. 60 kmph.consistently.

  • ish

    nano 2012 gave a mileage 32kmpl in highways at speed of 60kmph.