Big Boost to Tata by Nano bookings

SAN FRANCISCO -- Tata Motors Ltd. shares rallied 15% Thursday on a report the Indian company's Nano minicar is seeing a surge in interest on its first day for bookings in its home market.

Tata's U.S.-listed stock pulled back from its highs but closed up $1.00 at $7.64 in New York. The shares have rallied almost 72% since the beginning of the year.
The company has sold more than 51,000 order forms for the world's cheapest car, according to the Economic Times. The Nano, priced starting at less than $2,500, is slated to be delivered in July in phases to the first 100,000 customers chosen by lottery.

The Nano's launch was originally slated for the fourth quarter of 2008 but was pushed back after the company was forced to abandon a manufacturing site in West Bengal due to violent protests from farmer groups and a political party.
Tata on Wednesday stated "categorically" there are no current production problems to stand in the way of the car reaching its delivery goal this summer.

Tata in the past month has partnered with 19 banks that will fund purchases at competitive rates and ensure that any sales shortfall won't be because of a lack of available financing.
The credit crisis in the U.S. has made it difficult for customers to qualify for loans, pressuring an already fragile U.S. auto industry that could see the bankruptcy of General Motors Corp.

The Nano's arrival comes at a difficult time for Tata, India's biggest carmaker, with demand for its trucks and utility vehicles at home, and for the Jaguar-Land Rover division globally, falling hard in the face of the historic industry downturn.Tata swung to an unexpected loss in quarter ended Dec. 31, and it's not looking much better this quarter, given that sales dropped 26% in the first two months of the year.Tata, which bought Jaguar and Land Rover from Ford Motor Co.

last year, is planning to export the Nano to Europe and the United States, with a much higher price tag, over the next few years.Shawn Langlois is a reporter for MarketWatch in San Francisco.

Source: marketwatch.com