NANO-THE CHEAPEST CAR IN THE WORLD

We in India witnessed a historic moment on 10^th January when Tata Motors unveiled its ‘people’s car’, the car many skeptics ( including myself ) thought was a difficult proposition, if not entirely impossible, at a price tag of Rs. one lakh. Doubts were raised previously as to the build, safety and feasibility of the car, but Tatas have proved us all wrong by turning out a rather wonderful looking car which I hope performs as good as it looks.

As with any other object of public attention, the Nano has fuelled a debate in India among various sections of the public on issues mainly concerning environmental pollution, personal mobility at the cost public transportation, land acquisition for the factory and consumer response to the car among other things. These issues are examined here.

Environmentalists and NGO activists have argued that the Nano will promote greater pollution as it will be the most accessible car to the common public who, it is expected will give a more than favourable welcome to the car. I am of the opinion that this fear is to an extent exaggerated and partisan because as far as pollution is concerned a greater part of it is fuelled by rudimentary domestic and industrial waste disposal. Automobiles contribute a small part to it. With the advancement of ‘cleaner’ engine technology automobiles will contribute still lesser to such pollution. Moreover, the pollution attributed to automobiles is to a significant extent because of loads of antiquated public buses, taxis and auto-rikshaws plying on our roads today. The pollution in this respect can, thus, be cut down drastically by opting for more advanced vehicles such as the CNG taxi and rikshaws which were introduced in Delhi as a result of a Supreme Court directive, and which has reduced air pollution in that city to a great extent as admitted by many today. Nevertheless, environmental conservation is of prime importance but needs to be addressed at the right places where there is a significant lack of it.

It has also been argued by many that Nano is the culmination of the government’s policy of favouring personal transportation at the cost of public transportation. An organized and well-managed public transportation system is a undeniable need of every city and town . This should indeed be the concern of every citizen today and for which we need to take the administration to task. We should, however, be against any move to curtail the need for personal mobility. Any public transport system can at best connect the major transit points and centres of the city but not every nook and corner. There will always be a need to travel far and beyond the major transit centres of the city, and hence personal mobility is as important as the public one. In this respect the Nano has been targeted unfairly by some sections.

As regards land acquisition for the car factory, we as concerned citizens must see to it that land is acquired on a fair and equitable basis. Development and industrialization should not , however, be substituted by agitations with short-sighted purpose of keeping the farmer’s or owner’s right in the land intact against the long-term need to provide new means of income generation and an opportunity to aspire for a better standard of living.

At last we come to the critical question of consumer response and commercial success of the Nano. Despite my amazement at the Tata’s feat of engineering in creating a ‘people’s car’ I still doubt its effectiveness in cracking the middle-class market within our domestic contours. First, we shouldn’t expect all two-wheeler owners to go for the Nano. The two-wheeler is preferred not because it is cheap but because it gives greater mileage and is best for negotiating one’s way in the city traffic. Second, the middle-class consists of a number of income brackets, a great number of which aspire to and can afford to buy better cars. So, Nano will have limited market in this category. Third, we should not mistake public euphoria for public demand as has been proved time and again with many product and services. Fourth, the Nano wouldn’t be available to you and me at exactly Rs one lakh but at a slightly higher price taking into account taxes, insurance charges and inflation effect. Finally, we can expect other car-makers to reduce the price of their offerings so as to tempt the same middle-class buyers to go for a better car at a reduced price.

I have a feeling that Nano will find favour with many taxi operators serving the city public and the increasing number of tourists. Nano could be a commercial success export-wise if it marketed in other emerging economies as was the case in India with Maruti-800 in the yester years. However, Nano-enthusiasts have suggested that it will be a great success story in the domestic circuit as well citing it as a great value proposition. Only time will tell who was right and to what extent. For the time-being we can, as proud citizens, bask in the glory of having created the world’s cheapest car. Hail Tata Motors!!