Tata Motors Finally Admits Its Small Entry-Level Hatchback Is A Failure

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Tata Motors has finally admitted that its entry level small car Nano "has been a loss-making product," though the company has not given any visibility about its future.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

In a filing with the Bombay Stock Exchange, the company said that considering the attention and the excitement the Nano created, project investments were set up to churn out 250,000 units per annum.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

The company further added that unfortunately and due to combination of several factors which included project delays because of change of location of the factory and the perception of being a low-priced car, the volumes initially anticipated did not materialise.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Also, the utilisation of the capacities were significantly lower than expected. With the highly price-sensitive market along with low volumes, the Tata Nano has been a loss making product.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Reports suggests that the Tata Nano was constantly losing money even peaking at Rs 1,000 crore. Emotional reasons kept the project going and the current scenario might hold back future investment in the Nano project.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Tata Motors in its statement said that major part of the investments in the Nano factory in Gujarat can be utilized for other products.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Tata Motors manufactures its current best-selling Tiago in the same factory. This factory could be utilised for any of the future products from the company.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Tata Nano was launched back in 2008 with the price tag of Rs 1 lakh which was increased with time.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

The car was to produced at the Singur facility in West Bengal; however, due to protest from farmers, the factory was eventually shut and Tata Motors moved the project to the Gujarat facility.

Tata Motors Finally Admits Its Small Hatchback Is A Failure

Tata Nano is a two cylinder 624cc petrol engine paired to a 4-speed manual gearbox. The mill produces 37.5bhp with a peak torque of 51Nm.

Read more on: #tata motors #auto news
Story first published: Saturday, November 5, 2016, 9:41 [IST]
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