Here’s how Tata Nano can still become a global rockstar

With the Tata Nano possibly nearing its death, here's how Tata Motors can limit its losses and create a globally successful small car.

By: | Updated: August 23, 2017 4:07 PM


Future for Ratan Tata's dream project, the Tata Nano seems to be staring down the barrel of a gun as it struggles with dismal sales and growing heat within the company. Widely considered to be the Rs 1 lakh car or the car that two-wheeler buyers could buy is not even being produced in four digit numbers in an entire quarter, let alone the sales to customers. Recently, the Nano project again came under fire as Cyrus P. Mistry recently released an official statement in response to some facts in the 2017 Annual Report of Tata Motors. In his statement, Mistry said that while the Nano was a brave project, it didn't gain success due to many reasons. During his tenure, he tried to improve the product with features such as an opening tail gate, power steering, and AMT but none of them were able to put the Nano on the road to success. Mistry also stated that since these moves did not bring the desired result, a unanimous decision was taken to discontinue the Nano about one year back. A source close to the development in Tata Motors said that out of the Rs 280,000 crore revenue of Tata Motors, only about Rs 9,000 crore comes from Passenger Vehicle business and of that Nano contributes a very small amount. While Tata Motors might take more time to shut down the Nano production, here's how it can make a successful small car again and fulfill the aim that Nano was made for – safe and affordable transportation for masses.

Axe the Nano brand first

The first thing that Tata Motors should do is to say goodbye to the Nano brand altogether and limit its losses in the project. The reason for this is simple as the Nano brand is synonymous with failure for most people. So trying to sell even a great car as Nano wouldn't yield positive results. It's almost like trying to swim with a heavy rock tied to your feet. Sales and production numbers further testify the failure of Nano. The company didn't even produce 1,000 cars in three months of April to June 2017. What's surprising is that despite such a dismal performance, the Nano isn't a bad car at all and is impressive actually on many accounts such as space, safety and manoeuvrability. This clearly shows that Tata should get over legacy issues and stop making the Nano and simply relegate it to the company's history books. Even if the country's best-selling car were to be sold as the Nano, its sales would simply plummet.

So how to make the Nano successful?

Actually, no one can due to the issues discussed above but the objectives that Tata Motors set out to fulfill with the Nano can still be met. The only way to do is not by competing with Maruti Suzuki and Hyundai but by simply leapfrogging them and entering an area where its competition is still in a nascent stage. Light electric vehicles are the only one such area where Tata Motors could take a lead with an all-new small electric car. The company already has the manufacturing plant in place and also has a supply chain that could come in handy for a small car. Yes, having an electric powertrain would mean that one will need to get a new battery and electric motor supplier among others but there are already global suppliers with cost-effective tech almost ready.

Read more: India is a great incubator for an electrified future mobility: Bosch

This is where the TAMO came in as a great news as the company announced it would streamline its platform strategy and only have two modular platforms. Later, Volkswagen Group through Skoda was expected to enter a partnership to co-develop a modular platform but as most of you would know it, the deal was recently called off. This means Tata will now either have to develop the platforms on its own or look at finding a new partner. A modular platform is key to the company's passenger vehicle business and the company should act quickly on it. Such a platform can ensure multiple electric vehicles across segments, which could increase volumes, bringing down the battery cost. The opportunities don't end here since the recipe of a good and affordable small electric car hasn't been perfected yet globally. If Tata Motors can get its act together in this area, the company will also get access to numerous markets for exports and these added volumes could further bring the cost down. The Nano can serve as a good basis for a new small electric car that can truly be a global success story.

Tata has showcased the Pixel concept earlier and that's a brilliant place to start from. I'm sure Tata is working on something similar as we speak but they need to ensure they do it in time and get over with the Nano saga altogether. If the company can get a head start over the competition in the electric vehicle domain, the long-term gains could be great. Pushing further my belief is the Government's push for fully-electric personal mobility by 2032. Realistically, the plan might not be 100 % successful but even if it succeeds partly, we're talking about millions of new electric cars and I don't need to explain what kind of advantage would a first-mover have in such a situation.

Taking on Maruti or Hyundai in the entry-level segment is going to be more than an uphill task for Tata Motors. The opportunity hence lies in the small electric car segment and if Tata can leverage its vast supplier network and design a good package ahead of the competition, there are multiple reasons to believe that the vision and objectives of Nano can become successful, if not the Nano itself.

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    Rajeeth
    Aug 24, 2017 at 4:48 pm
    I am using Nano car . I am from middle class family . Nano is excellent vehicle on milage, space , parking comfortable , easy to drive in traffic , Disadvantage we can say drum brake first . If you say its small wheel we can't have disc brake mean then my question how Honda activa having disc brake is small wheel. Next point is sound of the vehicle vibration it's totally disappointing . If you take some bike which is 500 CCC there is no sound vibration at all. Great experience.. I have travelled in nano to Trivandrum from Chennai which is 750 kms I have find any problem we gone safe came safe . Vehicle milage with AC is 26 per litre. My feel this vehicle still have potential by fixing disc brake , control of noise , electrical wiring properly fixed in covered condition , adjustment of wheel base equally to four wheels . Nano is best car Alto 800 eon is not fit for me who is 5.8 to 6.2 height . We required like nano taller smart gaadi for like us middle people .
    Reply
    1. H
      HSMishra
      Aug 24, 2017 at 12:40 pm
      Nano is best car in this segment,drawback is only , its name lakhtakia car
      Reply
      1. K
        KSRao
        Aug 24, 2017 at 9:25 am
        Tatas should convert Nano to an electric vehicle, and also talk to Tesla to upgrade and co-produce the new-generation car. It's rather unfortunate such a nice product has lost its way from day one. Its success would have made India proud.
        Reply
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          R V Shah
          Aug 23, 2017 at 10:11 pm
          I fully agree with statement "Nano isn't a bad car at all and is impressive actually on many accounts such as space, safety and maneuverability". I would like to endorse the car after using it for more than four years on roads of Mumbai (daily commute to work). I think future is going to be favoring small car for intra-city transport and lighter vehicle is must for using electric power in place of petrol/diesel. For replacement I will be happy to get the car of similar size AND reliability.
          Reply
          1. J
            Jay
            Aug 23, 2017 at 10:03 pm
            NANO is well suited to get into the Autonomous Car business . TCS can help NANO get a head start by providing AI
            Reply
            1. A
              Antony Kuriakose
              Aug 23, 2017 at 9:48 pm
              Absolutely right! Nano is a beautiful and cute car. Consumers in India want conventional looking boxy cars! Tata must develop electric cars and come out with them quickly. Tata's response to market compe ion is very lethargic. Pixel looks stunning. It's really a good way to go.
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                Bhavadas T
                Aug 23, 2017 at 5:00 pm
                Change its shape similar to a Hatch or classical styling like WV Beetles or Morris Minor. Take it from me it will succeed. Present shape of NANO is to say the least "Shapeless" Sorry, this was my oft repeated comment on NANO to succeed.
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                  Asgar Ali Sayed
                  Aug 23, 2017 at 3:34 pm
                  I bought Nano in 2011 till date it has not given us any problem whatsoever. My Yellow Nano has become our family member. Whenever we are going out my g son age 2yrs will first kiss the Nano and then we enter the car. Since 6yrs we have been using this car. Nano is owsom. Cant think of changing it.
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