Tata Motors ties up with Jayem Auto to launch electric car Neo

The development comes at a time when the government has set an ambitious target of having only electric cars by 2030

The Tata Nano is soon to be launched in an electric avatar sporting a new label Neo. Some see this is as the first move towards phasing out the brand Nano, which has failed to excite the Indian car buyer nearly a decade after its launch. 

As for the new avatar of the Nano, Tata Motors, its originator, has little role to play in it. Tata Motors will supply the body shells of the Nano and Coimbatore-based Jayem Automotives will add the powertrain and electric motor for the Neo. Sources said the first 400 Neos were being made for a leading taxi aggregator and would be handed over to the company shortly. 

Tata Motors and Jayem Automotives had in March formed a 50:50 joint venture, JT Special Vehicles, for developing special performance vehicles. Jayem Automotives confirmed that it was going ahead with the launch of the Neo but refused to provide further details. Tata Motors did not wish to comment on the matter.

The 48-volt Neo will be assembled and marketed by Jayem Automotives and is designed to run 150 km with air-conditioning on a single full charge. “The Neo is powered by an electric drive system developed and supplied by Electra EV, a technology company that develops and produces electric drive systems. The first batch of cars will be supplied shortly,” said J Anand, managing director, Jayem Automotives.  

Nano sales have continued to bother Tata Motors but the firm has so far not commented on phasing out the car. It has been a year since former Tata Sons chairman Cyrus Mistry in a letter to shareholders had alleged that the Nano had constantly lost money, peaking at Rs 1,000 crore. The company had responded to the bourses, saying development costs and investments in Nano-specific dies and tools had been written off significantly over several years.

Tata Sons Chairman N Chandrasekaran was quoted recently saying that shutting down or giving the small car a life was not a billion-dollar question facing Tata Motors. He went on to add that the Nano contributed about 4 per cent of the losses Tata Motors passenger cars made on an annual basis. 

Tata Motors sold 1,493 Nanos between April and October and the buzz around phasing out the conventional variant of the car was becoming louder once it became clear the company was unlikely to investing upgrading the Nano to meet BS-VI emission norms, which will become mandatory from April 2020. 

Jayem Automotives has expertise in design, development, prototyping and production of performance variants of automobiles. Its associate motorsport company manufactures of one of the fastest Formula racing cars for MRF in Asia with Jayem Automotives’s assistance. 

Anand, managing director of Jayem Automotives, is a former F3 champion and the backbone for all R&D initiatives at the company.