Tata Motors, India’s third-largest car maker, on Saturday announced it had suspended production of compact car Nano at its factory for a fortnight in an attempt to correct inventory and carry out routine maintenance activities.
Owing to high initial costs and increased fuel value, the Nano has been facing rough weather in the retail market, with demand i the last month dipping to its lowest since January. The company also said after the two-week gap, production at Sanand in Gujarat resumed from Saturday.
“This (suspension of production) was done for maintenance and to rationalise and align inventory”, a company statement said.
Sales of the small car fell 64 per cent as country-wide dispatches to dealers from the company stood at 3,260 units last month, compared with 9,000 units sold in the same month last year.
Tata Motors dealers have been reporting high inventory levels of the Nano in the last few months, which lead to the correction. The company has stepped up efforts to promote the small car, despite a bleak outlook predicted by analysts.
Tata Motors, however, has said it was witnessing very encouraging response to the company’s consumer-oriented marketing efforts, resulting in increased inquiries and footfalls at its showrooms.
