Tata Motors has temporarily shutdown its manufacturing plant in Sanand, Gujarat, where the Nano is manufactured. The factory will remain closed for 35-40 days due to low demand for the world’s cheapest car, which has resulted in an inventory pile-up. The plant has been closed to commence an ongoing retooling activity to manufacture a new version of the Nano for launch in the festive season which is most likely the F-Tronic gearbox equipped AMT variant, powered by the same twin-cylinder petrol engine.
The Sanand plant is also getting ready to manufacture cars like the Bolt and Zest and a platform known as Kite, which is nothing but the replacement of the Indica and Indigo. Tata Motors has been operating the Sanand plant 2-3 days a week over the last six months due to low market demand. The company has taken these steps to stop incurring losses before they pile up further. This includes keeping the plant shut instead of increasing stock. The company has been producing 2000 to 2400 cars every month for the last six months.
Tata Motors says that all of their plants, including the Sanand facility, is closed for annual planning and upgrades. Maintenance and adding of tooling flexibility for new variants is the reason why the manufacturing facility has been temporarily shut down, something which will continue for the next three to six weeks. Made as an ultra low cost car, the demand for the Nano has failed to meet Tata’s expectations. Production in the last fiscal was the lowest at 21,538 units. However, the Sanand factory is capable of producing more than 2,50,000 units.
The company has also piled up a lot of inventory. Around 8000 to 10,000 units are in the stockyard with some cars made in 2013 not having managed to find homes yet. The company for its part says that they have seen a good rise in sales after the launch of the new Nano Twist. The CNG version of the Nano and the Nano with power steering did add some interest. The monthly sales of the Tata Nano are improving from 1000-1500 units to the current level of 2000-2500 units but is that enough? We just hope this car gets totally revised or gets a solid improvement in terms of powertrain and gearbox options to keep the first time petrol car buyer glued.