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ShareNEW DELHI: He's done it. Ratan Tata's "one-lakh car" really has a sticker price of Rs1 lakh, ex-showroom. "A promise is a promise," the Tata group chairman told a tumultuous gathering of newspersons and other gawkers at New Delhi's Auto Expo on Thursday. This means you finally have a car that you could buy with a credit card.
Almost exactly 100 years after Henry Ford "put America on wheels" with his Model T, Ratan Tata is about to do the same with his People's Car.
The Model T is widely regarded as the world's first affordable car, and if Tata's car performs as good as it looks, he will be the Third World's Henry Ford.
The bad news? By the time you get your keys to the Nano -- as the People's Car is named -- by end-2008 or early 2009, your final price, including taxes, transportation charges from Singur in West Bengal, and insurance could be around Rs1.3-1.4 lakh.
But that still makes it the world's cheapest car by far and a real steal at that price. The next cheapest car, the Maruti 800, currently costs Rs 2.11 lakh in Delhi, and even more in Mumbai, thanks to octroi.
That price gap -- between a Rs1.3 lakh car that looks like its meant for the 21st century and a Rs2.1 lakh car launched a quarter century ago -- conceals a mini-revolution.
The prices of steel and many auto components have risen substantially between Maruti's 1984 launch and Nano's debut, but the price to the consumer is dramatically lower.
In his preamble to the car's introduction, Tata talked about how imagination, rather than resources, was critical in surmounting obstacles and making wishes come true.
The Wright brothers fulfilled mankind's eternal wish to fly -- once considered impossible -- by producing a rudimentary airplane. Today flying is commonplace.
Tata's tryst with the Rs1 lakh car was similarly driven by the challenge of proving the cassandras wrong. "We did it because people said it couldn't be done," Tata said.
The interesting thing about the Nano is not really a great technology leap or a staggeringly new idea. As Tata himself said, "We did not reinvent the car.
What we have done is package everything in a small space." Using the Maruti 800 as benchmark, the cute Nano is 8% shorter but offers 21% more space inside to comfortably seat four persons.
At 20 km a litre, the car's fuel-efficiency is not enough to set the Hooghly on fire.
But the price benchmark changes the whole game. At Rs1 lakh-and-odd, the 624cc, twin-cylinder petrol car (the diesel will come later) crashes the distance between two-wheelers and cars, allowing bikers to own a car and car-owners to buy a second vehicle without worrying about the additional expense.
The car's specs - manual transmission initially, and gearless later, all-aluminium multi-point fuel injection engine, tubeless tyres, et al - will extend the potential buyer circle to almost everyone - from women to senior citizens, two-wheeler users, students and, in fact, the entire working class.
But the industry most under threat - two-wheelers - declines to see the Nano as a problem. Says Pawan Munjal, managing director and CEO of Hero Honda, the country's largest mobike maker: "This car will probably form a niche between two-wheelers and the M800. It will not really impact us."
Jagdish Khattar, former managing director of Maruti Suzuki, also seems to think the same. "It will fulfil a gap between M800 and two-wheelers," he told DNA.
But the covert attacks launched on the Nano even before it was unveiled tell us a different story. Osamu Suzuki, chairman of Suzuki Motor of Japan, derisively questioned the car's safety and emission standards.
"If a manufacturer sacrifices safety and emission norms, then it can't shoulder the responsibility of being an automobile manufacturer."
But the Nano meets India's Bharat III and will meet Euro IV emission norms. Ratan Tata says that the car would have "lower pollution levels than most two-wheelers."
Clearly, the Nano has set the dovecotes aflutter.
