Production delays to hit Tata Nano delivery

With the date of the launch nearing, it is learnt that Tata Motors’ Rs 1 lakh car, Tata Nano, will be available at a booking amount of about Rs 50,000 to Rs 60,000 from the second week of April.

The delivery of the car may take 12 months due to production constraints, sources said. It is believed that Tata Motors may collect at least Rs 400-500 crore on account of booking of the Rs 1 lakh car.

Nano’s base version volumes are likely to be low but financing for the car is likely to be higher than the current interest rates on passenger cars, sources added. Tata Motors may get its marketing and booking expense with the booking form cost and is likely to collect Rs 10 crore.

CNBC-TV18's Swati Khandelwal reports.

As far as a consumer is concerned who is looking at buying the Tata Nano—not so much of good news coming in as far as our sources are concerned. We understand that both the timing as far as the consumer will have to wait for the car and the price that he is looking at getting it may not be what it is claimed to be.

According to sources, currently, as far as the production volume is concerned, Tata Motors has only managed to manufacture 700-800 Nanos till today. Of course, they are trying to ramp-up the production as and when, and their target is to manufacture one lakh units by this fiscal year, which, most of the industry and other vendors feel is quite ambitious, and expect it to be around 70,000 units.

If we assume that they book the entire 70,000 units for a year’s time, there would be huge amount of delay. Delivery for up to 12 months for somebody who has booked a car today will have to wait because the production constrain is huge as far as this car is concerned.

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