Nano - finally!

I am not in this for any ego trip or philanthropy
Ratan Tata, Tata group chairman

The people’s car is finally within reach. Fifteen months after it was unveiled at the Auto Expo in New Delhi, bookings for the Nano, which is set to revolutionise the lower end of the global automotive market, will start from April 9 and end on April 25. Delivery of the cars will begin from July this year.

While the base model for the car is priced at Rs 1 lakh (ex-Delhi), the air-conditioned version will cost Rs 1.39 lakh-Rs 1.42 lakh and the deluxe model Rs 1.70 lakh.

Speaking to reporters ahead of the car’s formal launch at a colourful ceremony at the Parsi Gymkhana, Tata group Chairman Ratan Tata said he would dedicate the car to the common people of India. He also thanked the 500-odd people involved in the project who overcame their initial sense of disbelief to “give everybody in Tata Motors a great sense of achievement”.

Apart from representing the spirit of breaking conventional barriers, Tata said the project made perfect business sense for the company and he "is not in it for any ego trip or philanthropy”. The company has so far invested Rs 2,000 crore in the project.

Within 60 days of the closure of bookings, Tata Motors will process and announce the allotment of 100,000 cars in the first phase of deliveries, through a computerised random selection procedure. These 100,000 cars will be “price-protected” till delivery of the cars, though the booking amounts will not bear any interest for the customers. This indicates that the Rs 1 lakh price tag for the basic petrol-driven car will be revised later.

The delivery of these 100,000 cars could take a year, as the first batch will roll out from the Pantnagar plant in Uttarakhand, which has a capacity to produce only 5,000 cars a month. The situation will ease only after the company’s Sanand plant near Ahmedabad, which will have an initial capacity of producing 350,000 cars per annum, becomes operational early next year.

The company has signed an exclusive agreement with the State Bank of India to manage the booking process. While the application forms will be available at a price of Rs 300, Tata Motors has agreements with 15 preferred banks and non-banking finance companies to enable customers to book the car at Rs 2,999 only.

The interest rate for financing the cars will be 11.75 to 12 per cent depending on the tenure of the loan, SBI said in a release today.

Those choosing to pay their entire booking amount, can submit their application forms to SBI through 1,350 notified branches in 850 cites, and also at Tata Motors dealerships, Westside and Croma outlets. The option to submit bookings online is also available at the Nano website. The forms will be available at over 30,000 locations in about 1,000 cities.

Applicants have the option to retain their booking deposit even if they do not get allotment in the first phase. They will get interest on their deposit, effective from the date of announcement of allotment of the second phase, at 8.5 per cent for the retention period between one to two years and 8.75 per cent for a retention period of more than two years.

Tata said apart from Europe, the company was also planning an upgraded version of the Nano for the US, the world's largest automobile market.

The Tata Motors scrip ended 3.20 per cent up at Rs 166.05, but it underperformed the broader Sensex which went up 5 per cent today.