Ultra-cheap car: a false dawn?

[Cheetah786]

You are dismissing the economic POV here. Governments everywhere make investments in overseas bonds & fund development activities in other countries. That money comes from the taxpayer's pockets from that country. Also, one can aswell present the argument 'What right does a government have in investing tax-payer's money in establishing a public sector company that usually runs in loss?'.

Business with private sector is usually done this way. Heavy subsidy is provided in establishing a startup. Thereafter I suppose only the power is provided at subsidized cost. Once established the company provides revenue to the government & generates thousands of jobs (in this case it would provide direct & indirect jobs to nearly 100K people). This inturn helps government in expanding its tax base & helping generate higher revenues not to mention taking care of unemployment problem. So whatever initial subsidy that government provides would be recovered in the first or second year of operation.



Energon has given a proper argument here. The car would still be safer than a two-wheeler. If one can be unconcerned about travelling with his wife & two kids on a bike then he would definately feel a whole lot safer inside the car. The target customers are those whole take volumes of risk & still travel with their family on a 2-wheeler.

what Energon forgets to tell ya all about the subsidy provided by the west to car manufacturer is that west doesn't subsidize the petrol but actually tax it heavily.
So a 500million dollars investment in that sector will bring back millions/yr for the government in taxes on Petrol alone.(now how much will Nano bring in for the indian government if they also subsidize that and not tax it)

 

[Bushroda]

what Energon forgets to tell ya all about the subsidy provided by the west to car manufacturer is that west doesn't subsidize the petrol but actually tax it heavily.

You are so wrong here. US government provides several billion dollars in subsidy each year to both oil companies & consumers. Ever wondered how you can still buy gasoline for $2/gallon and why US public debt has accrued upto $8.5 trillion. Read the energy bill 2008 where they plan to remove subsidy on foreign oil & rather provide subsidy only for renevable energy.

So a 500million dollars investment in that sector will bring back millions/yr for the government in taxes on Petrol alone.(now how much will Nano bring in for the indian government if they also subsidize that and not tax it)

This is an economic issue. First of all primary customers are going to be the ones who would plan to switch over from 2-wheeler to car and bikes don't run on water. Why do you think that GoI wouldn't pass on the extra cost on to the customer? Why would anybody be reluctant to pay 5 or 10 extra rupees for a gallon if he is planning to buy a car? Let the government handle the economic issues. They have better qualified people who can manage the resources effectively.

 

[Logic note]

http://imageshack.us
Again price ''1-lakh''comes into picture because the whole thing is heavily subsidized by indian government.so in reality every indian tax payer is paying for it weather he or she likes it or not.TaTa couldnt have done it if he had to pick up the tab by himslef.but what most indians (and pakistanies 2) forget that Petrol in india (and pakistan)is heavily subsidized and indian government is losing billions cause of that.
So every time some one buys a NaNo Indian taxpayers pays for it then same person pulls into a petrol station tax payers pays for it.on top of that taxpayers will have to pay billions for the infrastructure that will be required for extra cars compare to motorcycles.
Honestly tell me would u buy one if u no its glued and plastic as far as saftey is concerned there is non in this vehicle i doubt average indian will find this out till out of showroom.

Where the hell did you get this notion of Subsidy here ????
There is no subsidy by any government . there is no gevernment involved here .
and hence it is an achievement by Tata group
As per your comment about the Plastic and Glue. it has met all the standard Safety and emission norms of western countries

 

[Energon]

http://imageshack.us
The basic Smart Pure model starts at under $12,000; standard equipment includes remote locking management, leather steering wheel, a 5-speed transmission, and a radio-ready console. Most metropolitan drivers will love the Smart Pure for many reasons. Such as the cars ability to park almost anywhere, its fuel savings and cost and of course its knockout looks.

Energon smart is been around for over 8 years now and surprisingly looks the same as NANO so as far as i can see its Tata thats taken it from there competitor and not the other way around.

The point still seems to elude you. You've failed to understand the whole concept of the Nano and put it into perspective.
The Smart Car was designed for savvy consumers who are either environmentally conscious, have a tight budget, live in a crowded European/western city or all of the above. This in no way shape or form can be compared to the Nano which was designed by Tata to entice a city dwelling customer in the third world who up until now could only afford a two wheeler as the family vehicle. What sets Tata's product apart is that up until now, not many efforts had been taken to design a car specifically with the aforementioned target audience in mind. So far, most of the cars marketed to the middle class of the third world fell into one of the following categories:

1. Direct imports of smaller and more affordable production models of major manufacturers with the option of cutting out amenities that are otherwise considered "standard" elsewhere.

2. Re branded older established models (which had since been replaced by newer models in wealthier nations) that are stripped of most of their amenities and produced under a manufacturing license.

As you can see, both of these categories were intended to have a "reach down effect", i.e. strip an established model as much as possible in order to make it affordable.

Tata is the first manufacturer in India who actually made a car specifically designed for people who could never think about buying a car as a "push up effect". Obviously, the intention is to market this car to every third world nation that sports such a population (which is pretty sizeable). This is what makes this idea unique and from a business standpoint brilliant.

Again price ''1-lakh''comes into picture because the whole thing is heavily subsidized by indian government.so in reality every indian tax payer is paying for it weather he or she likes it or not.TaTa couldnt have done it if he had to pick up the tab by himslef.but what most indians (and pakistanies 2) forget that Petrol in india (and pakistan)is heavily subsidized and indian government is losing billions cause of that.

The government will more than recoup their money if Tata's product is successful; and that as many posters here have already pointed out is how many nations (who are now developed) have facilitated industrial growth.

So every time some one buys a NaNo Indian taxpayers pays for it then same person pulls into a petrol station tax payers pays for it.on top of that taxpayers will have to pay billions for the infrastructure that will be required for extra cars compare to motorcycles.

Your understanding of the gasoline issue is a bit lacking; but you've certainly hit the nail on the head as far as the infrastructure issue is concerned. The government needs to rapidly expand quality road network systems or else there will be chaos. However that does not change the fact that what Tata has achieved is in fact a break through in Automotive production history.

Honestly tell me would u buy one if u no its glued and plastic as far as saftey is concerned there is non in this vehicle i doubt average indian will find this out till out of showroom.

First, you're blowing this whole glued plastic thing out of proportion. Most industrial design progress has been associated with lighter material composites and easier bonding mechanisms. Once upon a time cars were made from all-metal bodies; by those standards what we drive today is a major step down... but obviously we don't make an issue of it. I'm not saying that the Nano's current safety features can be persisted with in the future as India becomes a more developed nation with higher automotive standards. But for now, the nano is a big step up and far safer than having an entire family riding on a two wheeler.
And no, I wouldn't buy this car because I lived in a developed western nation, I can afford to buy a bigger car and most of all, this car wasn't made by taking me into consideration as a potential consumer.