Thursday, January 10, 2008

The most important car in years?

Although I've put a question-mark behind the title of this post, I think the just-announced Tata Motors 'Nano' car really is the most important car to come along in years. It's certainly got other major manufacturers thinking hard, with Volkswagen, Ford, Renault and Nissan already announcing plans for their own bare-bones vehicles.

The reason it's so important is simple: the base vehicle costs only the equivalent of $2,500. That's right - two and a half thousand dollars. Tata is based in India, where there's an immense pent-up demand for transport but very little in the way of low-cost alternatives to the scooter or bicycle (unless you count the donkey cart!). As Mr. Ratan Tata, chairman of Tata Motors, has said; "
I observed families riding on two-wheelers - the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family."

They certainly seem to have succeeded. The Nano seats up to five, has a 33hp. 623 cubic centimeter (38 cubic inch) rear-mounted engine with continuously variable transmission (meaning no clutch or conventional gears) and an adequate if not stellar performance (maximum speed about 60 mph) and claimed fuel economy of about 50 mpg. There are no frills: manual windows, no air-conditioning or carpets, just bare-bones transportation.

And when you think about it, isn't that long overdue? For the vast majority of car owners the Nano will address all their real needs. They aren't taking long trips through the countryside, or loading up their cars with large numbers of people. As a city commuter car this has real possibilities (perhaps adding a small air-conditioner for those long traffic jams). It probably wouldn't be very comfortable for a multi-hundred-mile journey, but those who make such journeys will buy more suitable vehicles anyway.

Furthermore, its small size and lack of power-draining accessories make it a perfect candidate for conversion to battery power once the new generation of capacitors hits the market (for an example, see here). Already they're achieving three to four times the battery life (or range, in car terms) of what's available today. Once you can install a battery and electric motor giving two to three hundred miles between plug-in recharges, this becomes a perfect city and suburban vehicle. The added expense of the electric drive may push the total cost into the $4-$5,000 range, but even so that's very affordable.

It has wider economic implications. Ratan Tata again:
"What we also wish to do, which is still not fully clear and a concept at this point of time, is to create any opportunity for entrepreneurs. Low cost units in different parts of the country will assemble the car where Tata Motors will take the responsibility for training on site and other aspects related to quality etc. We will give young entrepreneurs the opportunity to establish enterprises in distributed areas to produce this for us. We will produce all the high volume parts and send them as kits to these assembly units. This will also enable us to address some international markets in Indonesia, Africa etc on the same kind of basis.

So what we are looking at is designing a product that can be produced in high volumes, which we will do and than can also be viable in small volumes on a batch-basis from kits. With many products, if you conceive them for mass manufacture they cannot be produced in another form. This is what we are trying to do. It is taking more time because we have given ourselves a more complex situation, says Tata.

What he would like to see ideally, in the India of tomorrow, is 10 young graduates getting together out of an IIT and saying, Instead of having to work for somebody, we would become an enterprise of our own. He adds, Hopefully we would like that enterprise to also sell the vehicle in that area. We would like the service engineer to be trained by us that could perhaps serve the customer. He could use the spare parts of this enterprise to service the customer. Can we change the traditional manner in which the customer is supported on the product?

Eventually, the idea is to not only to give India a low-cost car but create many jobs in different places for young people who otherwise would have to work for someone."

This is potentially huge. Instead of needing large factories all across the globe one could look at decentralized assembly and service facilities - with all the reduction in environmental impact that such a step promises.

A small prediction, friends: this car will be worth watching. It'll also be interesting to see how the 'traditional' car manufacturers respond to the challenge. You can bet they really, really don't like what Tata has achieved here. I look for them to try to either shut it down, or beat it to death with their own competing models - which will promptly disappear from the market if they succeed.

I'm sure there'll be lots of bumps in the road ahead (you should pardon the expression) and problems to be worked out, but I think we owe Mr. Tata and his company a resounding vote of thanks for driving this project forward. It might just change the car market worldwide as we know it.
This should be interesting!



My Own Woman said...

After looking at it, I wonder how safe it is. It looks like any type of collision would destroy the car. Does the Nano car have any facts related to that?

Anonymous said...

From Mr. Blue:
Interesting. The Brits did somthing similar (with much success) years back with the original Mini. Small on the outside, huge on the inside, simple to work on, and a blast to drive (especally the Right Hand Drive version on US roads). Hope this one works out.

Anonymous said...

I'm wondering about the safety of it too.

Now, as a matter of personal preferences... it looks like a good deal in principle, but it's not a pickup truck. I doubt I could do much with it.

Rachel Leigh Smith said...

You couldn't pay me enough to get in that thing. It's tiny! I have a phobia of small cars. My Grand Am is too small and I'm looking to upgrade to a small SUV. But then I learned how to drive in an 8 foot tall Chevy sailtop conversion van.

Joat said...

It would never work in the US by the time you added all the Federally mandated safety features and emission controls it would cost $15,000 only get 30 mpg and not have the power to go faster than 30 mph.

HollyB said...

I don't know if it was a Tata or something another Asian manufacturer came up with...but a few weeks ago, I saw one here.
It had dealer tags, so hopefully there is a dealer here or in the metroplex carrying them. I'll do a search and let you know.

Unknown said...

Another plus is that after you get to where you're going, you can put it in your pocket & carry it in with you.

X_LA_Native said...

What I *think* you saw was the Smart Car (if you're stateside). It's a DaimlerChrysler product that became available in the US just this year.

Cars that small scare me.

Anonymous said...

The supplimental restraint system in a small US available car costs about $6000 to replace. It makes any car under $20K a throw away item after any collision.

Who notes his 1980 Dodge Colt RS was hit several times by people who just did not see it. Sigh.

Anonymous said...

My other issue with small cars is not only versatility and how well they take a crash, but the fact that my surgeon told me not to bother with small low-slung cars. I'm 33 years old and when I was 27, I got both hips replaced. They told me a good many folks who have hip replacements get them dislocated getting into low-slung cars.