Tata Motors borrows $3 b to buy Jaguar, Land Rover

Tata Motors has secured a $3 billion loan from Citigroup and J.P. Morgan Chase to finance its intended purchase of the British marques Jaguar and Land Rover from their American owner Ford Motors, according to media reports Tuesday.

The Wall Street Journal (WSJ) quoted a person familiar with the deal as saying Tata had secured a one-year bridging loan from the two banks.

Tata Motors are thought to have made an offer of around $2 billion to purchase the two luxury brands, and the deal is now expected to go through sometime next week, the paper said.

Other reports said money from the loan would also be used to finance the production of the recently launched Tata Nano, the world's cheapest car.

The WSJ said the deal could be signed as soon as next Monday.

But because Ford employees are off work Monday, a formal announcement could be made Tuesday or later in the week, the paper quoted "people familiar with the situation" as saying.

However, earlier reports in The Times newspaper had said the deal would be signed sometime around Easter, which falls on March 23 this year.

Ford said in a recent government filing that it expects the sale to be finalised with regulators sometime during the second quarter

A Ford spokesman said the company is "pleased with the significant progress" in the negotiations and that the two sides remain "on track" to reach a deal early this year. "There are no major roadblocks," the spokesman added.

Tata Motors tells parts vendors to speed up delivery for Nano

Concerned about potential labour shortages amid continued grass-roots opposition and a slow pace of work on buildings, Tata Motors Ltd is asking vendors to speed up delivery of components for the Tata Nano, a car that it plans to start selling for Rs1 lakh later this year.

According to two vendors supplying parts for the Tata Nano, the firm has asked key vendors of its 50-strong supplier base in Singur, West Bengal, to deliver components over the next 45-75 days at the latest, even as the completion of its own plant is some 90 days beyond the original deadline of starting production in July.

The vendors didn’t want to be identified because it would jeopardize their relationship with the firm, which has tried to keep details of the Tata Nano under wraps since showing the car in January.

The Tata Nano is likely set for an October roll-out from a Rs1,700 crore manufacturing facility in Singur that will be capable of making 350,000 units a year at full tilt.

A Tata Motors spokesperson said that the project was progressing according to the company’s timeline, whereby trial production will begin in June-July, followed with the commercial production of the car in October. The firm said it did not have any information to share on its vendor plans.

“Vehicle makers have experienced that vendors find it difficult to meet timelines,” said the chief executive of a vendor, who is setting up shop there. “There is also an underlying fear that the Mamata situation will surface again,” he added, referring to Trinamool Congress chief Mamata Banerjee, who has led farmer protests against Tata Motors setting up its plant in Singur.

Apart from these political tensions, the two vendors say there is a shortage of trained contractors and builders in West Bengal, which was slowing building work, forcing many vendors to bring in additional contractors from New Delhi, Gurgaon and Pune to get their plants built. Vendors are also grappling with the lack of skilled labour and technicians in Singur itself, which also reflects a general shortage of skilled manpower in India’s automobile industry.

One of the same vendors said that until the January formal launch, many suppliers were sceptical whether the Tata Nano would attract buyers. The generally positive response has now put those fears to rest, he added. Tata Motors has not yet opened bookings for the Nano, but its website has had more than 15 million hits since January.

Tata Motors’ project in Singur has turned into a lightning rod for forcible land acquisition, which has faced mass protests from farmers who say their land is being taken away without their consent to feed the state’s industrialization efforts, of which Tata Motors has become the key symbol.

There have also been constant clashes between police and farmers opposed to the project. In a battle that was taken to court, a Calcutta high court ruling deemed the land acquisition by the state government as legal, creating a further sense of dispossession among farmers.

India, where around 1.4 million vehicles are sold every year, has a huge appetite for small cars, and the launch of the Tata Nano is only going to fuel this demand, coming in the face of scepticism that cars can’t be built and sold profitably for such a low sum.

But by showcasing to the world that it’s not impossible, Tata Motors has set new benchmarks in design and raised the bar for other auto makers trying to build cheap, fuel-efficient four-wheelers. Bajaj Auto Ltd and Renault SA and Nissan Motor Co. are planning to collaborate on a small car that is cheap to use.

Overall, 880,000 small cars are expected to be sold this fiscal compared with 780,000 units in 2006-07. The vehicles market will touch 2.2 million units by 2010, according to the Society of Indian Automobile Manufacturers.

Electric cars Tara Tiny, Titu beat Tata Nano on price

Barely has the dust settled down over the global wonder, Tata Nano, than a barely-known company in the eastern fringes of the country quietly crept up to usurp the mantle of the ''cheapest car in the world''. And they are environment-friendly to boot, not to mention cheaper to run as well.

Tara Tiny is a two-seater, while its four-seater sibling Tara Titu, both of which can now claim to be the cheapest cars in the world, retailing at Rs99,000 apiece. Moreover, both are electric cars.

Tata Motors set the ball rolling, and the little-known Tara International set the bar higher and prices lower to produce the two cars. . Analytical equipment maker Tara International, an affiliate of Bengal Enamel, is building these cars at its factory at Palta, a few kilometres from Kolkata, and expects to launch them from July this year.

In addition to the tiny tots, Tara International has also lined up a 14-seater bus, the Tara Shuttle and a truck, Tara Carrier. These are also priced very competitively at around Rs500,000 each.

The company also plans to launch bikes priced between Rs12,000 and Rs35,000. Apart from West Bengal, the company's other production centres are located at Puduchery,better known the world over as Pondicherry and Lucknow.

All these vehicles are electrical vehicles, and to develop them Tara collaborated with Chinese electric giant Aucma. This partnership translated in to lower running costs and maintenance charges vis-à-vis petrol and diesel-powered vehicles.

Tara S Ganguly, the company's chairman and chief executive officer and grandson of the founder Col. Dwijendra Bhattacharya who started Bengal Enamel in 1921, says electric cars contain only 35 moving parts on an average compared to a conventional vehicle's 2500, contributing to lower wear and tear.

According to Ganguly, ''Fewer parts mean less maintenance and simpler service. Also, electric cars do not need oil, filters and coolants''. Additionally, increased efficiency of electrical motors coupled with rising crude prices, results in a nominal running cost of Rs0.40 per kilometre. This is in contrast to the most fuel-efficient petrol car running at a cost of Rs.2.00 per kilometre.

While the Tiny and Titu can be charged from a 15-ampere socket at 220 volts, the electric bikes need to be charged through 5 amperes at the same potential. A daily 6-hour charge enables bikes to travel 80 to 100km, whereas the cars need 8 hours of charging to cover the same distance.

However, the top speed is limited to 50kmph. Though an impediment to highway cruising, the top speed is sufficient for urban commutes, or as Ganguly says, ''that is supposed to be the sane speed for confined and populated areas.''

Pictures available of this pint-sized powerhouse show a left-hand drive configuration. Ganguly explains saying these are meant for export markets in China and the US, with India-specific vehicles being reassembled at their factories. He also revealed that the company had received an order for 100 cars from a London-based firm.

Ganguly is extremely optimistic about the future of this car as he feels, ''In this age of global warming and increased pollution, our future lies in green cars. I am extremely confident that these cars will be runaway hits in the international market''. In tune with this optimism, a target output of around 1,000 cars, 5,000 two-wheelers and 500 buses and lorries has been slated for the first year.

With crude prices slated to go higher and people's knowledge of global warming increasing, Tara may well have bestsellers on their hands. Not only do the cars offer more for less, they make you feel good while driving one, of having contributed in a small way to the betterment of the planet.

The Tara Tiny/Titu in a nutshell:

Specifications	Measurements
Wheelbase	2150 mm
Ground clearance	150 mm
Net weight	850 kg
Number of seats	2/4
Motor power	3000 W
Battery capacity	200 Amp-Hr
Battery voltage	6V*10
Recharge duration	8 hours
Maximum speed	50 kmph
Running cost	Rs.0.40/km
Price	Rs.99,000

UK firm secures supply contract for Tata Nano

TT electronics Plc on Tuesday said it has secured a contract to supply speed sensors for the Indian conglomerate Tata's Rs 1 lakh car, Tata Nano, which is expected to be launched later this year.

However, the financial details of the contract were not revealed.

In a regulatory filing, the firm said the sensors for the car would be manufactured by Padmini TT electronics Private Ltd, the joint venture between UK-based TT electronics and Padmini VNA Private Ltd, based in Gurgaon. The joint venture was formed in 2006.

"Although relatively modest in value terms, we regard this contract as a major breakthrough with Tata Motors and are very pleased to be part of the revolutionary 'one lakh car' project, which is expected to bring affordable four-wheel transportation to millions of people across the globe," TT electronics CEO Neil Rodgers said.

"We are delighted with this news which further endorses our strategy of investment in India's thriving automotive industry," he added.

Prototypes of the Tata Nano speed sensor have already been supplied and Padmini TT is now increasing output, in preparation for high-volume vehicle production scheduled for September 2008, the filing added.

When poor people pollute - the Tata Nano and eco-crime

It's small, it's cheap, it's low emission so... the arrival of the Tata Nano, India's new 'people's car', has been greeted by a wailing and a gnashing of the teeth from the environmental aristocracy. The prospect of millions of the global peasantry driving, emitting and pushing up 'our' gas prices is a nightmare. It promises to be, said Yale environmental law professor Daniel Esty, "an environmental disaster of substantial proportions."

In fact, the size, or even existence, of this environmental disaster is doubtful. A few millions of a car that emits 30 g CO2 per km simply isn't even an influence upon global CO2 emissions, let alone a disaster of even insubstantial portions. At that emission rate, doing 20,000 km a year each car will produce 600 kg of CO2: one hundred million of them on the roads would be less than 1 per cent of current emissions of over 6 Gtonnes. No, not substantial then.

But whether it is a substantial addition or not is dwarfed by the seeming ignorance of other commentators: "In none of our reports did we assume there'd be a car like this," said Judi Greenwald, a researcher with the Pew Center on Global Climate Change. Well, OK, cut Judi a little slack, no one did predict a car exactly like this: but everyone has indeed predicted that something similar would happen, that the peons would at some point be able to get off Shank's Pony and move around in the same way us civilised folks do. Indeed, all the concerns we have about global warming are rather based upon predictions that this will happen.

Apologies, but this is where a little economics becomes necessary. Yes, we've all heard of the International Panel on Climate Change, the IPCC, those people who issue the reports containing the scientific consensus on the issue (yes, we are assuming they are correct here). Greenland's ice disappears sometime around 2,500, East Antarctica a couple of centuries later and boy, then we all really are in trouble. But all too few people, and unfortunately all too few environmentalists, stop and wonder where those numbers come from. Yes, we've got lovely computer models to tell us what the temperature rises will be if we stick x amount of methane into the atmosphere, y amount of CO2 and so on: but someone, somewhere, has had to work out how much methane, how much CO2 is likely to be so emitted. And that comes from the Special Report on Emissions Scenarios, the SRES.

The SRES is a series of economic models based upon four families (again divided into scenarios but we're not going to worry about that level of detail). The A1 family assumes that in 2100 the world output (GDP) will be $550 trillion for some 7 billion people. That is, that the world will be at least ten times richer in 92 years than it was eight years ago (essentially, growth goes on as it has since 1850). A2 (what the Stern Review uses and, umm, the low globalisation model) has 16 billion people and $250 trillion in GDP. B2 10 billions and $250 trillion, B1 $350 trillion and 7 billion again. These are the economic assumptions upon which everything we are told about climate change rests. Yes, there are different assumptions in them about how technology develops but all of them are entirely without any attempts at all at mitigation. That is, all the numbers we work with assume that we don't have carbon taxes, we don't ban patio heaters, we don't abolish the aeroplane. Anything we do along those lines reduces the damage that might be done.

Just as an aside we might note that these models all assume that the less trade we have, the more regionally based the world economy, the more self-sufficient we all become, buying locally, the worse the outcome. Campaigning to reduce globalisation to counter global warming is like fucking for virginity.

While none of the families specifically predicts the Tata Nano, all of them predict that the great unwashed will indeed have transport: and no, none of them predict that that transport will not be fossil fuel based. So while those folks at the Pew Center might be correct that this specific thing was not predicted, something very like it was. In fact, the existence of growing wealth and thus mobility is rather written into the plans that worry us.

Which leads us to the glorious George Monbiot. In a recent column he said:

"So economic growth this century could be 32 times as big an environmental issue as population growth. And if governments, banks and businesses have their way, it never stops. By 2115, the cumulative total rises to 3,200%, by 2138 to 6,400%. As resources are finite, this is of course impossible, but it is not hard to see that rising economic activity - not human numbers - is the immediate and overwhelming threat."

Leave aside his (known) ignorance of economics: growth is not defined by nor is it dependent upon the consumption of resources. It's defined as the addition of value to them: making sandpaper and a computer chip both consume sand, but one is the addition of rather more value than the other. Thus economic growth is not constrained in the way that he thinks by resource availability. Look rather to his "this is of course impossible".

In talking about climate change and the dangers thereof he tells us that a continuation of past economic growth is impossible. But as we can see above, the world's largest report on the subject, indeed the scientific consensus, is that said growth is indeed possible. In fact, the terrors of climate change depend upon it being so, for the whole science is based upon the outcome of economic growth. Thus George has either, by showing the impossibility, told us that climate change isn't a problem or that, perhaps more likely, he doesn't know what he's talking about.

Which brings us back to those worrying about the Tata Nano: it isn't a horror for the climate, it isn't a disaster. It's actually one of the things already built into our models which lead us to our current understanding of what will happen. We've already taken account of it in our calculations, you see? As we have all those other things: more flights, more people, more wealth. We even know the solution, a Pigou Tax, but that's a matter for another day. ®

Tata Nano for Europe in 4 years

India's top car maker Tata Motors will create a European version of the world's cheapest car within the next four years, a company executive said in an interview to be published on Monday.

"In four years, we're going to develop a successor (to Tata's bargain-rate Nano car) that will respect Euro-5 rules on exhaust emissions and European requirements in terms of safety standards," Girish Wagh, head of Tata's small vehicles department, told the German weekly Focus magazine.

In January, Tata unveiled a $2500-car billed as the world's cheapest to mixed reviews. While experts say the car could revolutionise how millions travel, others worry about pollution.

Wagh did not say how much the European spin-off might cost

NANO AND AFTER - The revolution in small cars must be matched by other changes

The design of the Rs 1 lakh car by Tata marks the coming of age of Indian manufacturing. Much of Indian manufacturing has used technology bought overseas, received technology through foreign collaborations, copied products sold overseas, sometimes using reverse engineering to arrive at a good copy, but rarely developed an original product by itself. This is clear from the data on patent filings. The total number of patent filings by residents in India per million population was 3.40 in 2004-05. The world average was 250.72. The number of patents in force in India in 2004 was 6,406; it was 1,82,385 in China, and in force worldwide during 2004 was 5.4 million. The development of the Tata Nano is believed to have led to the filing of 200 patents. The small low-priced car from Tata is the first product from India — not just among cars — that has been designed and developed from scratch to fit a price target. Every component has been designed and costs negotiated keeping in view also the likely production and sales volumes. The end product is a car and not a simulation of one.

We must celebrate this triumph of Indian engineering design, development and scaling-up. It will without doubt set off a rush of similar attempts by Indian companies in many industries, not merely transport vehicles. It marks the coming of age of Indian manufacturing, not as imitators but as innovators. India’s pathetic 15 per cent share of manufacturing in gross domestic product versus 50 per cent for services reflects the low levels of consumption in India. Manufacturing contribution must grow quickly if our people are to lead better lives. The Tata Nano presages this surge in Indian manufacturing.

The bandwagon of cheap car manufacture will roll in India and elsewhere, following the Tata Nano. (Bajaj has already unveiled a concept car to reach the market in three years). They would all have benefited from the work of the first mover, Tata. American and other overseas car-makers will study the Tata car to find out how Tata managed the low cost and yet made a profit. We can expect that many manufacturers of other products, not only cars, will want to start designing and manufacturing in India.

It is too late to moan the resultant boom in cars and in consumption generally. India has bought the Western consumption model, not the austerity of Mahatma Gandhi. The Western consumption model has severe adverse effects on the world’s stock of depleting natural resources, environment, ecology and climate. It introduces into society a strong competitive element in consumption. People want what others have, and more. The communications revolution has made these desires common globally. To deny many the comforts (like cars) enjoyed by a few is discriminatory. If there is unrestricted usage of cars, we will severely damage the quality of peoples’ lives as roads get more crowded, parking becomes even more difficult, pollution increases as the number of cars in use rises manifold, and the country spends even more on importing oil. But it will be impossible to put the genie of enterprise and innovation of which the Tata Nano is the prime example, back into the licensing bottle. The new Tata low-priced car is a feather in India’s engineering and innovation cap. It also enables much wider automobile ownership and usage than was ever deemed possible.

There are few alternative paths to more cars on the roads. We could voluntarily change lifestyles and restrict the usage of such comforts even while owning them. Or, the government could do what it did for 40 years, that is, restrict the production of these small cars.

We must never go back to the era of licensing of manufacturers by the government where some bureaucrat decides what can be produced and consumed. We need enterprise and innovation, badly hindered during 40 years of licensing. People should not be prevented from buying cars or anything else. The answer to more cars is to build more roads and quickly, control traffic and use pricing — for parking, petrol, entry into crowded areas, pollution standards, and so on — to restrict the use of cars.

Cars priced at Rs 1 lakh and around Rs 1.40 lakh on the road are about half the price of presently available cheap cars. We can expect the prices of second-hand cars to drop to levels (for the cheapest) that are close to prices of two-wheelers. Sales of scooters and, to a lesser extent, motorcycles will dive. Rural use of motorcycles might continue to increase as will niche use of specialized two-wheelers, and use by the really low-income groups. Many scooter-buyers will graduate upwards to cheap or second-hand cars. The two-wheeler buyer will also consider the comparatively high running and maintenance costs as well as costs of parking for any car, apart from the higher capital costs even for the Tata Nano. These factors could keep many prospective buyers of two-wheelers, as well as their present owners away from the Nano and its followers. But as second-hand car prices drop further, the number of cars will increase exponentially, with an explosion of four wheeled vehicles on the roads.

With relatively less two-wheelers to cars, there will be fewer fatalities from road accidents. Delhi figures for some years suggest that out of 1,800 road deaths each year, two-wheelers account for around 600 while four-wheelers account for about 90. Given that the Tata car has passed collision norms, we can expect less road accidents caused by it. Many more affordable taxis will replace the autorickshaws, their quarrelsome drivers, noxious fumes, and traffic nuisance. They will supplement inadequate public transport in our cities but add to the congestion on the roads.

The explosion in the demand for and manufacture of cars will act as a terrific stimulus to the economy as it did in the US and has done in many other countries. This has already begun to happen in India and will now accelerate. Many industries, from steel, aluminum, rubber, plastics and glass, to service industries have done very well over the last few years as a result of the automotive expansion and will see a further boom. Exports of cars, auto parts and accessories will also shoot up. Employment in many sectors, from parking, car servicing, repairs, auto-parts and spares, accessories, sales and others will rise. The Tata car presages a bigger boom in all these, as India moves to become an important manufacturing economy. Road construction has already stimulated the Indian economy, as it did in the Eisenhower years in the US, with the building of highways. More roads will further stimulate our economy.

The issue with the new Tata Nano is not that it has arrived. That must be welcomed. It marks a major step forward for Indian manufacturing. It enables more Indians to aspire to owning cars and other consumer goods and will stimulate the economy.

The problem is the inefficiency and lack of ambition and foresight in our governments. They have been unable to anticipate demand in a fast growing economy where many do not have access, but aspire to greater consumption. There are many examples: tardiness in airport development, inadequate capacities planned for new airports, power generation and distribution, and above all, construction of roads, parking spaces, bridges, culverts and flyovers, to accommodate the road traffic. Perhaps the new model of public-private partnership used for the expansion of Bombay and Delhi airports, many road projects, and other infrastructure construction now envisaged, should be put to more general use so that there are more such projects, built faster and of better quality. If government agencies are kept away from the execution of such projects, we might see a faster expansion of these facilities.

Don’t let us condemn an extraordinary engineering achievement. Let us find ways to integrate it into a good infrastructure and pricing of the services that these vehicles will consume.

Some fear super-cheap car's environmental cost

At the close of the 2008 Auto Expo early this month, hundreds of Indians swarmed into an exhibition hall to catch the first glimpse of the Tata Nano, the world's cheapest car.

As the throngs jockeyed for position to snap pictures of the jellybean-shaped vehicle with cell phone cameras, they seemed to hardly notice the latest sports cars, attractive showgirls and the blare of the Eagles' classic song "Take It Easy."

"This is a good day for India," said Rajesh Bindal, a paint salesman who attended the premiere of the Tata Nano. "Now everyone can afford to travel safely in comfort, to be modern."

At a total cost - after taxes - of about $3,250, the four-seat vehicle has been widely hyped as the people's car - much like the Volkswagen in the 1930s. Ratan Tata, the car's developer, hopes the Tata Nano's price of less than half of the current cheapest automobile will open the market to India's rising middle class when it becomes available in the fall. Tata Motors, which already sells compact trucks and heavy commercial vehicles in Europe, Africa and Southeast Asia, says the car won't be available in the United States or anywhere outside India anytime soon.

Tata said he came up with the idea of an ultra-cheap car after seeing a family of four perched on a small scooter braving city traffic. "It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family," he said at the expo's opening ceremony.

The Indian media quickly likened him to Henry Ford and referred to the Tata Nano as the new Model T, which is generally regarded as the world's first affordable car. A new Tata Motors factory in West Bengal state is expected to churn out a maximum of 250,000 cars a year, with additional plants constructed depending on the car's success.

Tata, 70, is a U.S.-educated businessman with a reputation for proving his critics wrong. After he took over his family's company in 1981, the Tata Group eventually became India's largest conglomerate, with revenues of nearly $29 billion in 2007 from industries ranging from telecommunications, insurance and steel to hotels, textiles and aluminum.

In step with an economy that is growing at 9 percent a year - second only to China's 10.9 percent - sales of compact cars in India have been increasing exponentially. In fact, auto sales have grown by more than 20 percent a year, in contrast to the global average of 3 percent, according to the Society of Indian Auto Manufacturers. And many first-time buyers are India's middle class - estimated to be between 200 million and 300 million people.

Yet there are environmental concerns that the Tata Nano may be more menace than miracle in a country that is already having severe problems coping with increasing pollution, poor roadways and chaotic traffic.

"The Nano is giving me nightmares," said Rajendra Pachauri, 2007 Nobel laureate and chairman of the U.N. Intergovernmental Panel on Climate Change. "Let's not fool the public. This car will not substitute for two- or three- wheelers but is only going to add to the confusion, road snarls and pollution."

India is the world's fifth-largest producer of carbon emissions, releasing 250 million tons a year, more than any European country. Its carbon emissions are expected to triple by 2020, according to a 2004 U.N. survey.

A recent study by the New Delhi-based Center for Science and Environment found that average vehicle speed in the city has dropped to 9 miles an hour in 2002 from as much as 21 miles per hour in 1997, due largely to the influx of compact cars. The trend toward cheap vehicles will only aggravate congestion and smog-related illnesses, the study says.

And Tata Motors is not the only company ready to cash in on India's low-wage skilled labor force and burgeoning purchasing power by producing economical cars.

France's second-largest carmaker, Renault SA, is talking with India's Bajaj Auto to produce compact vehicles that may cost as little as $3,000 and wind up being sold in the United States after modifications. Other auto titans such as Hyundai, Suzuki, Honda, Volkswagen and Ford have also opened factories in India.

In past years, environmentalists have lobbied the Indian government to improve the nation's faltering mass transit. The subway in New Delhi, for instance, serves just half the city, while traffic accidents in the capital involving overloaded public buses claimed 128 lives last year, according to police statistics.

"We have a very weak regulatory framework for motorization in India today," said Sunita Narain, director of Center for Science and Environment. "We have a very distorted policy in which the car is promoted and the bus is negated."

Anumita Roychoudhry, a policy researcher at the same organization, says private cars occupy roughly 90 percent of India's roads but are used by only 5 percent of commuters. She also says a 2004 World Bank study showed that owners of privately owned buses paid more than twice the taxes of private car owners.

"Car taxes should be raised to reflect the true cost of driving," to upgrade and expand public transportation, Roychoudhry said.

Debasis Ray, Tata Group's head of corporate communications, however, says the cheap car will not exacerbate the nation's gridlock and may even improve road infrastructure due to high demand for the cheap car. As an example, he points out how the explosion of low-cost airlines in recent years spurred improvements at airports around the country.

Ray and other company officials are also convinced their critics will be won over by the fact that the Tata Nano meets European emissions standards and gets 47 miles to the gallon.

Nevertheless, the 77 percent of Indians - about 836 million people - who still live on less than 50 cents a day, according to the government, won't be buying the Tata Nano anytime soon.

Outside the auto expo, Sushil Kumar was selling hot tea laced with milk for 10 cents a glass at a sidewalk stand. He said he had heard of the car, but hardly had the funds to repair his beat-up moped, let alone buy an automobile. "I would like a car to take my wife and daughter out," said Kumar. "But saving money is impossible with this small job and a family."

In the meantime, some environmentalists are taking a wait-and-see approach, arguing that the Tata Nano may help phase out less fuel-efficient cars.

"If the Nano takes over the market from gas guzzlers, then that's not really a problem," said Soumya Rahut, a spokesman for Greenpeace India. "This could be a boon, or a bane, depending on what it replaces."

Ispat offers to supply steel for Tata Motor's Nano

NEW DELHI: Domestic steel maker Ispat Industries may become the first company outside the Tata fold to supply steel for Tata Motors’ ‘lakhtakia’ car Nano.

The company has initiated talks with Tata Motors for supplying auto grade hot roll coils (HRC) for Nano scheduled for launch later this year.

“We have started dialogue Tata Motors for supplying HRC required for its small car Nano. As the company is already an established supplier of steel to Tata Motors, we are hopeful to be part of Nano project too,” Ispat Industries (IIL) executive director (marketing) Vinod Garg said.

IIL is currently meeting roughly 80% of HRC requirements of Tata Motors for its Pune plant. With the addition of Nano, the company would become the single largest domestic steel supplier for Tata Motors.

Apart from IIL, Tata Steel and other global players supply steel to Tata Motors.

Priced at about Rs 1 lakh, the Tata Nano car is set to revolutionalise the automobile industry creating an altogether new segment. Though the car is expected to use high levels of plastics and lighter metals like aluminium, it would also use steel, especially for body and components.

“The HRC requirements for the car may be a mere Rs 200 Kg, half that of other small cars. However, with initial production of about 2,50,000 cars which will soon get doubled, it would provide enough business for steel makers. The HRC would be used for body moulds and other applications by the new car,” a steel industry expert said.

Rough estimates suggest, that the Nano deal would translate into annual sale of over 50,000 tonne of steel by the steel maker.

IIL produces special grade steel for automobile that is light in weight and is stronger, an ideal combination for Nano. The business opportunity in Nano is part of IIL’s strategy to expand its portfolio of value-added steel for segments like automobile, oil and gas, pipeline and consumer durables.

“We plan to increase the share of value-added steel in company’s product mix from the current 35% to 50% by next fiscal,” Mr Garg said. The company is planning to expand its HRC capacity from the current 3 million tonne (mt) to 5 mt by 2011-12. It is also focusing on development of its power business.

In fact, the company is planning offload its equity in Ispat Energy, a wholly-owned subsidiary, to private equity players and other strategic investors to raise resources for implementing the power plan.

Ispat Energy is currently implementing 110 MW captive power plant for the requirement of company’s steel plant at Dolvi, Maharashtra.

Renault and Nissan to develop a Tata Nano rival car

Renault and Nissan to develop a Tata Nano rival car

Renault and Nissan would continue to work on their plans to develop a low cost car to challenge the recently showcased Tata Nano car.

Renault Chief Executive Officer Carlos Ghosn said in a statement: “We’ll go ahead with it” on being asked this question.

Tata showcased the Nano car at the recently held Auto Expo exhibition in New Delhi. The car is priced at around USD 2500 though the on-road cost would be a bit more than that.

Renault is already selling a cheap sedan in the market named Logan but it currently cost around four times as much.

Ghosn added on their plans: “You’re going to see Renault and Nissan coming with a different car in the same price range for the Indian market.”

The company had earlier said that they aimed to build a car that would sell for around USD 3000 in the developing nations.

Nano car factory cases dismissed

An Indian court has dismissed claims that land was acquired illegally for the manufacture of the world's cheapest car, the Nano.

Opponents of the plant accuse the government in West Bengal state of taking 997 acres of farmland at Singur by force.

The decision comes a week after industrialist Ratan Tata unveiled the Nano car, priced at $2,500.

The building of the Nano factory is well under way.

The Tata group are aiming to start selling the car in mid-2008.

West Bengal's Marxist government is trying to attract investment to rejuvenate the state's ailing economy.

'No violation'

A Calcutta High Court bench, comprising Chief Justice SS Nijjar and Justice PC Ghosh, said they had found "no violation of the Land Acquisition Act or any other regulation" by the West Bengal government in acquiring the land.

In February last year, one Joydeep Mukherjee had filed a petition challenging the acquisition of land at Singur in Hooghly district, about 40 kms from the state capital, Calcutta.

Mr Mukherjee, along with 10 other individuals and associations who joined the case as added petitioners later, claimed that the land had been acquired illegally.

They also alleged that agricultural land was acquired for building the factory which was illegal.

The court rejected all 11 petitions.

They followed months of fierce protests by a section of local peasants led by opposition parties like the Trinamul Congress. The West Bengal government, in its defence, told the court it had not violated any legal provisions while acquiring land for the Tata plant.

The world's cheapest car Nano, which has attracted tremendous media and public attention since its launch, is to be manufactured at the Singur factory.

State officials say scores of other automobile ancillary industries are lining up for space in Singur to set up their manufacturing units. Opposition leader Mamata Banerji of the Trinamul Congress party has not yet reacted to the judgement.

Little Nano attracts big Sunday crowd

A massive turnout marked the fourth day of the Auto-Expo at Pragati Maidan here on Sunday, with most people making a beeline to catch a glimpse of the brand new “one-lakh” car from the Tata stable.

The state of affairs outside Pragati Maidan was also testimony to the spilling crowds within the gates. The approach roads to the venue were jammed not just with vehicles but also with hundreds of pedestrians making their way to the expo. The affected roads included Tilak Marg, Ring Road and Bhairon Marg. A religious function organised at Bhairon temple in the vicinity only compounded matters throwing traffic into another mess.

The unprecedented crowd compelled security personnel to temporarily bar entry to the expo premises from around 3 p.m. onwards. However, the sizable crowd on Saturday had prepared the organisers for an even larger turnout on Sunday and various measures had been put in place to tackle the increased number of footfalls.

According to a representative of one of the organising companies Siddharth Upadhayay, the total security deployment was almost doubled for Sunday, as were the number of exits. “Though we wanted sufficient security arrangements, the idea was to not scare away the casual visitor by having a disproportionately large number of cops at the venue,” he said.

The organisers also increased the display height of the “Nano” to render it viewable to a greater number of people from afar. Policemen were also instructed to guide people to the relevant stalls and signboards providing directions were put up at regular intervals. Going by ticket sales, the organisers staked the official turnout at 1.3 lakh.

Despite the “Nano” still being the centre of attraction, a Yamaha-sponsored rock show proved a sure-fire hit with the young. Bands “Parikrama” and “Frequency” thumped out anthems at a frenzied crowd, with state-of-the-art motorcycles gracing the backdrop. The rock show and motorcycles apart, other pavilions that saw the maximum visitors were the ones displaying “approachable items”. Voicing the thoughts of several others, a visitor said: “Not many can afford to cough up a crore or so for an automobile. The cars in the 5-10 lakh bracket are the ones I am really interested in. Even the robotics display is a treat to watch.”

A car for Common people

“I am not buying the Nano,” said my wife on the evening of the day it was launched. I had got home after battling heroic crowds on New Delhi’s roads, stuck for what seemed like hours as crowds surged for a look at the car that would redefine the way the country commuted to and from work, even though, for the moment, it seemed to have stopped all commuters in their tracks.

“Even if you do,” I retorted, “you’ll probably be part of a queue that stretches for months. But,” I asked her, “why wouldn’t you want the Nano in the first place?” “At first,” explained my wife, who has been wanting to trade in her old car for a new one for some time now, “I thought I could buy not one, not two, but three or four Nano cars for the price of another hatchback. That way,” she explained to my incredulous look, “I could match the colour of the car with the colour of my clothes, which would be a better fashion accessory than a Louis Vuitton bag,” she sniffed.

“It would have created parking problems at home,” I reminded her, for we are not allowed more than two cars per apartment. “Problem-shroblem,” my wife shrugged off the responsibility. However, I realised I need not feel faint at the thought of a long line of Nano cars crowding our garage, for hadn’t my wife said she’d decided against the car anyway.

“But everyone is calling it cute, and saying they want to buy it for themselves,” I reminded her of the adulatory TV and newspaper reviews the car seemed to be enjoying, rather hoping that she might opt for just one car, thereby saving us a lot of money in the process. “I did not say that I do not like the car,” said my wife, “but that, you see, is the problem.”

It appeared that when they went down for a walk, my wife’s best friend Sarla told her that she had decided to buy two Tata Nano cars for the household. “But she and her husband both already have new cars,” I said to her.

“Precisely,” exclaimed my wife, “but it is not for themselves that they want to buy the two cars.” “It must,” I pointed out reasonably, “be for their two daughters then.” “You are not listening to me at all,” shouted my wife, “the reason they want to buy those two cars is to give one each to their driver and their cook.”

I must admit that I was flummoxed. “Isn’t that,” I asked tentatively, “rather indulgent of them?” “They’re doing it just to spite me,” said my wife, “they know I’m unlikely to drive the same car that their staff does.”

“But why would they want to give their staff cars anyway?” I asked. “It was a mystery to me too,” agreed my wife, “till Sarla explained that the driver commutes in a bus, and is all sweaty and grimy by the time he reaches her home. As a result, no matter how much freshener she uses in her car, the interiors end up smelling too.”

By providing the driver, and the cook, who similarly smelled up the kitchen, their own commuting cars, she was doing herself a favour, Sarla apparently told my wife.

I would have taken no notice of my wife and Sarla’s perhaps notional ambitions had a friend not called to lament that he would now have to increase his driver’s monthly salary, and all because he would have to compensate him for the petrol used for commuting in — you guessed it — his Nano car.

Which is why, Mr Tata, you will have to excuse us for not buying your excellent car.

Tata reveals world's cheapest car

For millions of people in the developing world, Tata Motors' new $2,500 four-door subcompact - the world's cheapest car - may yield a transportation revolution as big as Henry Ford's Model T.

The potential impact of Tata's Nano has given environmentalists nightmares, with visions of the tiny cars clogging India's already-choked roads and collectively spewing millions of tons of carbon dioxide into the air.

Industry analysts, however, say the car may soon deliver to India and the rest of the developing world unprecedented mobility.

"It is a potentially gigantic development if it delivers what has been promised," said John Casesa, managing partner for the Casesa Shapiro Group, a New York-based auto industry financial advisory firm.

"I think there is immense unmet demand for a vehicle of this type, because it effectively eliminates the great leap currently required to go from a two-wheel to a four-wheel vehicle," Casesa said. "They are creating something that has never existed before, the utility of a car with the affordability of a motorcycle."

The basic model, expected to roll off assembly lines later this year, will sell for 100,000 rupees, or about $2,500, but analysts estimate customers could pay 20 percent to 30 percent more to cover taxes, delivery and other charges.

Company chairman Ratan Tata, who introduced the new car at India's main auto show, has long promised a $2,500 "People's Car" for India - a country of some 1.1 billion where only seven of every 1,000 people own a car. That vow has been much-derided by the global industry which said it would be impossible without sacrificing safety and quality.

"A promise is a promise," Tata told the crowd after driving onstage stage in a white, luxury edition Nano, his head nearly touching the roof. Four company executives emerged from another. Tata says the Nano can seat five.

The company will not say how the price was kept so low on the basic version and won't say how much the luxury Nano will cost until it hits showrooms toward the end of this year. The company also refused to let reporters sit in the car, let alone drive it.

But the basic version is austere: There's no radio, passenger-side mirror, central locking or power steering, and only one windshield wiper. Air conditioning that would spare motorists the brutal Indian summer is available only in deluxe models.

The little car, with its snub nose, sloping roof and slightly bulbous rear, makes it look like another Indian icon - the mango.

The Nano's appeal, though, is not its pedigree but its price - targeting people moving up from the lower ends of India's transportation spectrum, where two-wheeled scooters selling for as little as $900 are often crammed with entire families.

The Nano's closest competitor is the Maruti 800, a four-door selling for nearly twice as much.

In terms of performance, it doesn't offer much more than the Model T. The Nano has a two-cylinder 0.6-liter gasoline engine with 33 horsepower, giving it a top speed of about 60 mph, according to Tata. It gets 50 miles per gallon.

The Model T cost $850 when it debuted in 1908, comparable to about $19,000 in 2006, according to an aggregate of Consumer Price Index figures. And the Nano bests the Model T's 20-horsepower, four-cylinder engine, which topped out at 45 mph. Ford's car got between 13 and 21 miles per gallon, which is still better than a Hummer.

Analysts believe the Nano could transform the auto industry, forcing manufacturers to lower prices and perhaps find cheaper ways to sell cars than in sprawling showrooms. French auto maker Renault SA and its Japanese partner, Nissan Motor Co., are trying to find ways to sell a compact car for less than $3,000.

"Most of the other carmakers are watching this development very closely," said S. Ramnath, an auto analyst at Mumbai-based brokerage firm SSK Securities Ltd.

For now, the car will be sold only in India, but Tata said it hopes to export it to developing nations across Asia, Latin America and Africa in two or three years.

Tata initially plans to manufacture some 250,000 Nanos per year. That would be about a quarter of all cars sold in India last year.

The emergence of the Nano has fueled a host of concerns.

With developing countries like India and China putting more and more cars on the roads, it has created a greater demand for fuel, contributing to sky-high global oil prices. India consumed nearly 120 million tons of petroleum products in 2006-2007, according to the Petroleum Ministry, up from 113 million tons the previous year.

And the idea of such a low-cost vehicle has environmentalists petrified, conjuring images of traffic jams at midnight, hours-long commutes and rolling clouds of pollution.

Chief United Nations climate scientist Rajendra Pachauri, who shared last year's Nobel Peace Prize, said last month "I am having nightmares" about the car.

"Dr. Pachauri need not have nightmares," Tata said at the unveiling, promising the Nano met all current Indian emission standards.

Girish Wagh, who headed the design team, said the car has an oxidation catalytic convertor that emits 120 grams of carbon dioxide per kilometer (about 7 ounces per mile).

Tata's promises have not reassured everybody.

"If you're talking about urban environment, it will cause serious problems," said Jamie Leather, a transport specialist with the Asian Development Bank. "The cheaper and cheaper vehicles become, the quicker those pollution levels will increase."