Tata Motors is, to its credit, a pretty progressive firm even for the automotive industry arguably already the most innovative sector among heavy manufacturing. The speed and degree to which they have turned around Jaguar LandRover in the UK, not by pouring money into it (although they have invested) but by building the innovative WMG collaboration between university research and company design teams, which has resulted in a near universally acclaimed range of beautiful and popular saloons and SUVs. As a result, JLR is on track to turn in a profit of £1 billion ($1.65 billion) this year, a far cry from the loss making decades under Ford’s ownership. Credit should be given to Ford, though; a fair part of today’s success is a result of the investment and change they brought to the firm while it was under their control, and it’s a shame they were not around to reap the benefits.
Back in India, Tata grabbed the world’s attention with the world’s cheapest car, the gas-engine Nano, which got off to a rocky start when the production location had to be moved following local political unrest — and a few early models caught fire. Sales have settled down to an uninspiring 8,500 per month, according to the unfortunately acronymed Indian motoring blog site BSMotoring. For a country of 1.2 billion, that’s still pretty small beer and compared to the small-car Indian market favorite Maruti Suzuki Alto at 25,000, the Nano clearly has some catching up to do.
Well, Tata thinks it has the answer. If a cheap purchase price is not enough, they will shortly be offering fuel consumption to match most 180-cc Indian motorcycles. The diesel engine under development with Bosch India is said to be a 600-700 cc two-cylinder CRDI (common rail direct injection) diesel engine producing about 30-35 bhp and much more torque than the petrol engine. Although no official figures have been released, it is expected the car will be able to return 40 kilometers per liter or 94 miles per US gallon (118 miles/imperial gallon). The model is expected to do well as diesel is subsidized in India, unlike gasoline. In Mumbai, unbranded diesel is 33 percent cheaper than petrol. At 40 kilometers/liter, the running cost of the new Nanos are estimated to be Rs 1/km ( about US$0.02/mile). The capacity of the fuel tank is expected to be 15 liters, good for about 375 miles if economy results live up to expectations. Bosch, who worked with Tata to develop the Nano’s original petrol engine, says the development is well underway and the finished car should be available by the end of this year. Prices are likely to be higher than the Nano, but will be competitive with Bajaj Auto’s new Ultra Low Cost Car that is under development in collaboration with Renault-Nissan, said to also be on track for 40 kilometers/liter fuel economy.
It’s doubtful that even with such frugal consumption figures either car will find its way to Europe or the US anytime soon, with local manufacturers like BMW able to offer bigger, more sophisticated models capable of 60 mpg (70+ mpUSg) and for buyers used to the sophistication such models bring, the Nano will remain an emerging market auto. But Tata is to be applauded for breaking ground in this way, and where they lead others will be challenged to follow.