Tata Admits Mistakes with Nano

Company said it wasn't ready with an advertising campaign or a dealer network.

The boss of India's Tata Group conceded on Jan. 5 that the company had made mistakes with its Nano, the world's cheapest car, saying it now wanted to change the perception it was a "poor man's" vehicle.

The 140,000-rupee (US$2,650) Nano has failed to take off as expected since its launch in 2009, with analysts blaming poor marketing and a series of technical problems including some highly publicized engine fires.

Sales have been a fraction of the 25,000 a month the company once expected, falling to a low of just 509 units in November 2010. In December, the company sold 7,466 units, a rise of 29% from the same month the previous year.

"I don't think we were adequately ready with an advertising campaign or a dealer network," said chairman of the Tata conglomerate Ratan Tata, referring to the early days of sales.

Speaking on the sidelines of the Auto Expo show in New Delhi, he added: "I think we wasted an early opportunity but have not, in fact, seen much in terms of competition for the pricing of the car."

Tata, chairman of the Tata Group which owns Tata Motors, added that he was still confident about the car's potential in a country where millions are moving into the middle classes.

Analysts say the Nano was seen as a vehicle for Indians to buy once they could afford to upgrade from a motorbike, meaning it failed to appeal to the status-conscious and aspirational new middle classes.

"We've never pushed it as a poor man's car but an affordable, all-weather, family car," Tata said, adding that "whatever stigma has been attached to it, we will undo going forward."

Copyright Agence France-Presse, 2011

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