Filed under: Economy, India, Tata
HItting $2,500 difficult for Tata's Nano as steel prices rise
The Tata Nano exudes frugality, and when you're trying to build a capable vehicle for a paltry $2,500, that's not exactly unexpected. Unfortunately for the Indian automaker, the quickly rising cost of steel may thwart plans to hit the magic price-point. The price of steel has risen by 50 percent in less than a year, and even though the little Nano is only 1,300 lbs, when you're making an econobox on the mega-cheap, every penny counts. Like US automakers have done in the past, Tata is looking to its suppliers to shoulder some of the financial burden. Amazingly, the suppliers are okay with that, provided that Tata does its share.
Even with concessions from suppliers, it's still up in the air as to whether Tata will achieve its lofty target. It appears using a nice round price as a selling point for a vehicle that's a year away wasn't such a good idea after all.
[Source: Automotive News - Sub. Req.]
Reader Comments (Page 1 of 3)
Pacman 11:34AM (7/08/2008)
It costs less than a Honda Scooter! How is that even possible.
Reply
Donkey 11:55AM (7/08/2008)
http://powersports.honda.com/scooters/model.asp?ModelName=Helix&ModelYear=2007&ModelId=CN2507
One Honda Helix = $5,300 even the Elite 80 costs $2,300.
Amazing if Tata pulls off selling it for $2,500. It HAS to be a total piece of crap though, can not be otherwise. Has to, no doubt about it. Absolute rubbish car is all that is nneded though. There is no way it is not the most horrible little box you can possibly build. It is the equal to processed cheese. Tastes like crap, it is not good for you, but it looks like cheese and does the function of cheese. Nothing exciting but it melts. That is what this is, a processed cheese car.
This is no engineering feat but it is a great idea for developing countries. Any car company could build a crappy car as cheap as possible but no one will becasue there is no profit - very brave of Tata to do it. Also, the risk of being sued is too great with such a little death box in any developed nation This can only work in a developing country with people happy to get a car no matter how bad it is. This is not a sacrifice or bad vehicle when your other car is a goat. Good job Tata.
Donkey 12:03PM (7/08/2008)
Also helps when you build it with child labour and only use child labour sourced suppliers.
rdiddy 3:31PM (7/08/2008)
Donkey,
You said "Any car company could build a crappy car as cheap as possible but no one will becasue there is no profit." FYI -- after seeing the Nano, Nissan, Renault and Suzuki are all aspiring to play their game i.e. develop an ultra-cheap for the developing world.
As far as your snide child labor comment goes...do your homework...tata is not run by martha steward or phil knight.
Vincenzo 1:01PM (7/08/2008)
Honda Scooters cost less than 40,000 rupees or $900, that's 30% of the Nano's price.
http://www.honda2wheelersindia.com/products/default.asp
Gregg 1:06PM (7/08/2008)
Donkey, have you seen what passes for family transportation on many Indian roads? I have seen a mother, father, child and baby all on one small motorcycle. The ubiquitous breadbox Suzuki Maruti van is far less safe than the Nano. This is a great achievement, as no one else has figured out how to make a strippo car this cheaply.
apearlman 1:18PM (7/08/2008)
Donkey -- a "processed cheese car"? Not a bad idea, but I think cheese is more expensive than steel.
Also, any evidence for your child labor point?
darkhelmet 3:32PM (7/08/2008)
@donkey
your name is very fitting, you idiot.
zmf001 11:41AM (7/08/2008)
This is an amazing exercise in cost cutting!!
@Pacman: The Honda Scooter prolly has more safety features :-)
Reply
P.V. 11:47AM (7/08/2008)
LOL! +1
P.V. 11:48AM (7/08/2008)
LOL! +1
P.V. 11:49AM (7/08/2008)
(Stupid double-post)
Starnerf 11:45AM (7/08/2008)
Surely they could find cheaper wheelbarrow wheels.
Reply
Alex 11:46AM (7/08/2008)
What are they, 12 inch wheels? Cut them down to 10 inches and you'll see some steel savings right there.
Reply
MikeofLA 11:49AM (7/08/2008)
Use plastic as body cladding, like the Smart.
Reply
Brooks Van Norman 11:49AM (7/08/2008)
I'm not sure Tata is going to be able to pull this one off....
Reply
steveo391 11:55AM (7/08/2008)
I'm starting to think the same thing. At the beginning it seemed like a good idea for 3rd world markets. But it's getting to be a lofty goal, besides who wants to be sitting in front of $10 airbags?
J3-Colt 11:54AM (7/08/2008)
Somebody please get a fly swatter and kill it...
Reply
baffledu2 12:51PM (7/08/2008)
I'd rather have a Yugo !!
Spike 12:03PM (7/08/2008)
Will a "Limited" edition follow with leather seats and and a refrigerator in the console?
Reply