Nano sparks interest across India

At 6:46 p.m. on April 9, R. Sampath-kumar signed a check for 3,809 rupees ($78) and ordered his first car: a Tata Nano.

Bookings for the ultra-cheap car, which retails for 100,000 rupees ($2,050) plus tax and transport fees, opened last week across India. Sampathkumar, who is 30 years old and single, makes about 20,000 rupees a month ($410) as a goldsmith and says he wants a Nano for status.Automatically, women will come forward, he said, grinning.

Dozens gathered to gawk at the silver Nano sitting on a red platform with pink satin skirting at the Tata dealership in Coimbatore, a mid-size manufacturing hub in southern India. Two deejays blasted Backstreet Boys, Ricky Martin and Madonna songs, while college kids snapped photos of the snub-nosed car on their cell phones.

Despite the festivities, analysts say Nano sales won't do much in the short term to help debt-strapped Tata Motors, which is facing falling sales and is in talks with banks to refinance a $2 billion loan it took out to buy Land Rover and Jaguar from Ford last year.

Vaishali Jajoo, auto analyst at Mumbai's Angel Broking, estimated that even if Tata Motors manages to sell 250,000 Nanos a year, it will only add 3 percent to the company's total revenues.

Production constraints mean Sampathkumar won't get his new Nano until July, at the earliest. Violent farmer protests forced Tata to relocate at the last minute a factory that was to exclusively build Nanos, and the replacement won't be operational before year's end.

Customers who want to buy the Nano must pay 300 rupees for an application form, then pay the entire cost of the car or get financing from one of 18 banks Tata Motors made special arrangements with.

Tata will accept orders until April 25 and then randomly select 100,000 people who will get the first shipment of vehicles. Everyone else will have to wait. Tata will pay interest on booking deposits: 8.5 percent for people who have to wait one to two years to get their Nano, and 8.75 percent for those who hold out longer.

Tata spokesman Debasis Ray said 300,000 people had visited Tata's 400 showrooms across the country since the car went on display April 1.

Vijayakumar Jayabal, 50, a policeman who earns 12,000 rupees ($246) a month, said he wants to buy a Nano because he can't squeeze his family of four onto his motorbike.We only fit three people maximum, he said.

Associated Press
By Erika Kinetz