Nano mishaps prompt booking cancellations

Written by Yogima Seth | New Delhi | Updated: Oct 28 2009, 08:25am hrs
The two recent incidents of parked Tata Nano cars catching fire have created panic among the prospective buyers resulting in cancellation of bookings. While 12-15% of our bookings were earlier cancelled because of the long waiting period, there has been higher number of queries, and the rate of cancellation has gone up to 20% following the fire incidents were reported last week, an executive with one of Tata Motors biggest dealerships in Delhi said on condition of anonymity.

We have received bookings for 2,000 vehicles. But by now, nearly 400 people have cancelled their bookings. A few are even asking for re-sale of the vehicles, he added.

However, Tata Motors has denied any cancellations post the fire incidents. We have not received any cancellation requests post the incidents that have been reported on Tata Nano, a Tata Motors spokesperson said, adding that there had been some cancellations by those whose deliveries were slated for late in 2010 or by retainees, whose deliveries are scheduled after completion of the allottees.

Tata Motors had in July announced the names of 1,00,000 people who would get the car till March 2011. While the exact numbers are not available, considering a cancellation rate of 15-20%, bookings for nearly 15,000--20,000 vehicles have already been cancelled within less than four months since the first car hit the Indian roads.

There is panic and some degree of dissatisfaction at the customers end who are yet to get their cars, a dealer in Chandigarh said. This panic comes despite the assurance from Tata Motors that it would undertake pre-emptive checks on 7,500 Nanos that have been delivered till date.

According to analysts, while this will affect the future rate of bookings for Nano, it is also helping dealers to make money by facilitating resale of the vehicle to other customers.

People have become extra cautious about the car. While those who already own it now are taking their vehicles to the workshop for check-ups, people on the waiting list are preferring to cancel the bookings rather than buy it and get into trouble later, a Mumbai-based analyst said.

People have got so scared after the recent mishaps that 5-10% of those who are about to get the car are talking to dealers for immediate sell off even if it fetches them a premium of Rs 10,000 to Rs 15,000, said a dealer in Ludhiana.