Ta-ta Nano: Tata Motors announces discontinuation of the 'people's car'

Touted as the ‘People’s car’, Tata Motors announced that the production of Nano would be stopped and the company would end sales from April 2020. The company stated new safety and emissions rules along with poor sales for the discontinuation of the world’s most affordable car.

The company confirmed that the 10-year-old car “in its present form cannot continue production beyond 2019”. There were reports since last year about the company thinking to discontinue its entry-level car due to declining-to-no sales.

The ‘Lakhtakia Gaadi’ was an ambitious project by the company’s then CEO, Ratan Tata. It was launched with the vision that families who travel on two-wheelers would replace their bikes and scooters with a Nano.

Launched in 2009 with a price tag of a bit over Rs 1 Lakh, the Nano was launched in two variants- a basic model and a luxury version that was priced higher. The car was selling well with the company getting good numbers.

There was even a waiting period since the capacity in the company’s manufacturing plant in Sanand, Gujarat had only a capacity to produce 60,000 units per year. Tata sold over 9,000 units of Nano in 2010.

However, in 2011, the company only sold 500 units citing many reasons like very poor performance in safety tests and even the car catching fire in Mumbai. This led to a lot of negative publicity for Nano. The car was then misinterpreted as the ‘cheapest car’ that lacked safety features.

Following poor sales, Tata Motors decided to upgrade the Nano with additional features. The ‘GenX Nano’ was focused more on the youth and had received graphical upgrades and colours.

It was equipped with CVT and better fabrics on seats. It also came with a functioning hatch door that enormously increases the value of the car. There were changes to the front and rear bumper to make the car look more attractive.

But all these led to a price hike and the car was sold at an ex-showroom of Rs 2.36 lakh. The company only sold 275 units till June 2017, whereas it sold only three units in 2018. The export figures too were very poor as the company did not ship even a single car internationally last year.

Tata Motors had a very promising idea, but poor marketing cost the company’s Rs 2,000 crore idea a fortune due to which the company is now facing an astonishing Rs 1,000 crore loss. Undoubtedly it was not an affordable car for Tata Motors.