Tata Motors said on Thursday that all issues on compensation with the component vendors for the Nano have been resolved. Most vendors are expected to shift their facilities to the vendor park in Sanand, Gujarat, by March.

The Sanand plant, with an installed capacity of 3.5 lakh units a year, will start operations by the first quarter of the next fiscal.

There were previously some issues regarding the fresh investment some vendors would have to make at the Sanand facility, especially when many had invested at the previous site in Singur, West Bengal.

In October last year, Tata Motors had announced the shift of the Rs 1,500-crore plant for the Nano from Singur to a greenfield factory in Sanand, after protests over land acquisition for the project.

When asked if Tata Motors would share the burden of fresh investments by the vendors, a company official replied, “A mutual agreement with the vendors has been reached. Vendors are in line to set up their facility in Sanand,” said Rajiv Dubey, President, Passenger Cars Divison, Tata Motors.

A senior official added that many vendors have set up their facilities, while some plan to supply the parts from their factories elsewhere.

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