India's Tata Motors Ltd. is developing a new variant of its Nano mini car--the world's cheapest car--for the US market, which would be ready in three years, its chairman said Tuesday.
"We also recognise there is a market not only in developing countries, but possibly for a low-cost car in developed markets. For the US, we need a car that will have a larger engine, which needs additional crash tests, modifications, and we're in the process of doing this," Ratan Tata said at the Auto Expo 2010 in New Delhi.
The Nano was the show-stopper at the 2008 New Delhi Auto Expo, with the mini car grabbing headlines across the world owing to its low price of about $2,500.
It has a 624-cubic centimeter gasoline engine, measures just over three meters in length and is being sold in three versions.
The base model costs 115,361 rupees ($2,473) at showrooms in New Delhi, while the top-end model--costing 172,361 rupees --has features such as air-conditioning, front power windows and a rear wiper.
The car is pre-booked for deliveries until December 2010 due to a low production base because of a last-minute change of plans over establishing the manufacturing plant.
Tata Motors, India's largest automobile company by sales, opened Nano bookings on April 9, 2009, more than a year after its was first unveiled to the public, and it received 206,703 bookings by the time order taking closed on April 25.
Deliveries began in July 2009 and the company delivered 13,924 units during the July-November period, averaging about 3,000-4,000 vehicles a month.
"Our intention is to maximise the capacity we have and make as many people have the car as they wish to have," Ratan Tata said.
When he was separately asked about the media reports that said that Tata Motors was planning to acquire Fiat's plant in Termini Immerse, Sicily, he said that both the companies had only heard about it in the media, "so it is totally untrue."
The demand for low-cost, fuel-efficient cars has prompted several global auto makers to announce their own plans for similar models to the Nano. Small cars account for nearly two-thirds of car sales in India, where annual sales are forecast to grow to 3.0 million units by 2016.
Ratan Tata said that Tata Motors was working on electric hybrids, multi-fuel vehicles, bio-fuels and electric cars as future models, that will incorporate environmentally-friendly technology.
"We are trying to see whether we can apply that to the Nano as an electric small car and we are quite active in what we have done," he said.
Tata Motors controls Jaguar and Land Rover, which it acquired for $2.3 billion from Ford Motor Co. in June 2008.
Ratan Tata said Tata Motors, along with the U.K. luxury brands, will have to jointly address the market differently from how it had been addressed the past few years.
"Hopefully we can create a more aggressive company in the market place," he said.
He said that while there was no short-term objective to turn around Jaguar and Land Rover, both the brands would eventually be profitable and add to Tata Motors' profits.
"Together we will be a profitable company," Ratan Tata said.
Earlier, the company had announced that it plans to close one of its two units in West Midlands--the UK-Jaguar plant at Castle Bromwich and the Land Rover plant at Solihull.
But Vice Chairman Ravi Kant said that no decision had been taken yet. "We had said one of the two plants... but we have not taken the decision yet. That decision will be taken much later."
source: online.wsj
