Sunday, December 12, 2010

Maruti Suzuki Alto Beats Tata Nano’s Expectations

In 2009, when Tata Nano was given a striking coverage by media, the small car had orders for more than 200,000 Nanos but due to problems like production delays and fire accidents the car sales have gradually come down. While the rival cars like the Maruti Suzuki Alto have overtaken Tata Nano with sales more than 30,000 in November, making it India’s best-selling car last month.

As Tata has been bedeviled with production delays and fires in some Nanos, rivals like the Maruti Suzuki Alto have gained an edge. The Alto, retailing at $6,200 in India, is now the best-selling car there. Though car sales have shot up across India, because of an economy that is growing at nearly 9 percent annually, sales of the Nano have been falling for the last four months. Its maker, Tata Motors, sold only 509 Nanos to its dealers in November — a stark contrast to the 9,000 it delivered in July. Last year, when media coverage and auto writers’ praise were stoking demand, Tata had orders for more than 200,000 Nanos, which has a list price starting at about $2,900.

The Nano’s celebrated rollout had helped prompt other big automakers, like General Motors and Renault-Nissan, to announce plans for ultracheap people’s cars of their own for sale in India and other developing countries. Those would-be competitors are still expected to appear in the next two years. But the Nano’s poor showing could give pause to corporate executives and policy makers, eager to see goods and services sold to people of modest means.

Maruti Suzuki Alto is approximately Rs 1 Lakh more than its equivalent TATA Nano model. If one actually has a Nano budget, then wait for the introduction of Maruti Suzuki Cervo, the price gap is going to be narrower. Crevo price tag is estimated to be 1.50 to 2.00 lakhs. it will be in by December or Jan next year. Maruti Suzuki is not yet ready to give up its small car market leadership. With the introduction of Maruti 800, Maruti Suzuki has been undisputed king of small cars in India. TATA Nano was a challenge to its dominance, but, Nano has failed to live up to people’s expectations.

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