NANO – Rs.1 lakh Peoples Car

Nano - Tata’s 624 cc - 1 lakh ($2500 Car) dream car has been launched on 10th Jan’08 and will be available from Sep’08. On the face it is good news for the masses. Many two wheeler owners are expected to shift to four wheels with four seats. May be it is not a good news for the manufacturers of two wheelers.It is a boon for the family of four who sits on the Motor Cycle or Scooter with wife or kids or both sitting precariously on the pillion reciting Hanuman Chalisa under their breath.

It will also reduce the fatalities in road accidents in a country where even the Highway riders do not bother to wear the helmet. And rather helmet is treated like Gandhians used to treat the imported clothes during Swadeshi Movement.

The Nano, as the Rs.1 lakh car is named, is projected to making the dream for owning a four wheeler a reality for the self propelled two wheeler owner as well as bullock propelled two wheeler owners – the farmers. It will provide safe, affordable and all weather mode of transport for “Hum do Humare Do”. This is the logic given by RATAN TATA. A very noble thought indeed. Ratan Tata also said while unveiling Nano that even though the figure of Rs.1 Lakh was announced about 5 years back still the car will be offered at Rs.1 lakh - “Promise is a Promise”.

There are people who dream for themselves and their families but there are people who have risen above all these and they dream for the people. Though Ratan Tata does not have an immediate family, which is immaterial as he is beyond all these worldly attachments. He is the kind of corporate people who love to dream for the masses and in the light of this his vision and fruition of vision is laudable.

TOI published an article about consumption of petrol worth 1040 crores in a period of two years by 2010, by which time 5 lakh Nanos are expected to hit the roads. The correspondent had made this, the emission of polluting gases and the loss to exchequer on account of subsidy of 164 crore (assuming 365 litres per car per year for 5 lakh cars @ Rs.9.00 of loss per litre on subsidy) in two years as the point which in his opinion is the greatest disadvantage. It has been further stated that the consumption of Petrol will increase by the entire quantity for 5 lakh cars of 18.25 crore litres. This oversimplified assumption is fraught with errors.

Firstly the increase in number of cars does not mean increase in the number of people and the same person will either drive two wheeler or a car. Thus there may be marginal increase in consumption. Nano has far lower pollution levels than two wheelers and the adverse environmental effects due to the marginal increase in the petrol consumption would be offset by lower pollution levels.

Apart from the assumptions, which would not hold ground, this is taking a very narrow view of things. There are other important issues, which are more important.

In Metros and big cities like Ahmedabad, Pune, Jaipur, Hyderabad etc. the parking is a big issue and problem for the car owners and pedestrians alike though for different reasons. The space required for parking Nano, however small it is will not be less than that required for 3 two wheelers. It is not only the issue of space but also of the ease of parking two wheelers. That issue is of concern to the users. In the long run it will result into construction of costly parking spaces, the money for which would go from the pockets of not only the Nano owners and non-Nano owners but even non car owners. So it will then concern everyone.

Secondly, it will encourage the use of individual transport at the cost of public transport – which is the trend presently. This creates further problems – of costly transportation, burning of more imported fuel, further loss of incentive (reduction in compulsion) for the government to do something in the scenario of dilapidated public transport system and increased congestion on roads. There has hardly been any addition in the roads in the cities with the result that the roads are getting choked. Hardly much scope is there for improvement except for building flyovers here and there until we plan vertical expansion of roads to two or three tier roads, which in itself will be a costly proposition. And there is no end to it.

On the contrary, a good public transport system can be built, which would be far cheaper in the long run. Not that no steps are being taken on this front but there is a need to curb the increasing number of cars by some suitable legislation as is prevailing in some countries like Singapore etc.

At present travel using public transport is largely considered to be below dignity except for by Mumbai Suburban and Delhi Metro. This will change only if the state of art technology is brought in this field of public transport in the cities having population of more than 10 million.

The auto rickshawwalas are also thinking seriously for going for Nano as its cost compares well with that of petrol driven auto rickshaw costing around Rs.1.20 lakh and will also give them a big image, esteem and social boost. I am serious.

Nonetheless the technological feat by the Engineers of TATA MOTORS is commendable to produce a world standard car at the lowest prices possible and this will spurn the low cost technology products in automobile sector. TATA MOTORS has filed for 34 product patents for NANO itself. And the other important thing is that TATA's have given the people of India a product which never existed before.

The issue is not as simple as it appears to be. There would be more issues than meet the eye and only time will tell if this launch was a boon or a bane. Thus I take the launch of 1 lakh car with a pinch of salt.