The Nano is finally out in the market. Many things have been said about it, a lot of it uncomplimentary. Let’s look at some facts first -  1) It is a proper, well engineered car, not some sort of auto rickshaw. 2) It performs very well, from all the test runs I have been hearing about on the media.
Yes it’s true that those looking at snob value and positioning in society will not touch it, but do they matter? I can think of several who would like this car, once its reliability is established (ie., it is as maintenance free as the Maruti 800). For instance, think of a retired couple who do not plan to travel out of town (and hence do not need a lot of luggage space), have retired with about 10 lakhs in the bank and a pension of about 20,000 per month. They expect to visit friends and relatives on a regular basis on weekends. Their need is no more than 500-600 kms per month. This car, with easy manoeuvrability should be ideal for them.
Or think of a family of four with an annual household income of about 3-4 lakhs per annum, living in the suburbs of Mumbai. The bread winner will continue to travel by the local, but on week ends they would like to take a few short rides, away from the fumes of the auto rickshaw. There is plenty that this car delivers and there is a very large market in the segments it addresses.
I doubt that there is anything to worry about in terms of the market for this products. The worry, if any, was whether a car could be engineered at the targeted price points. That they have managed to do it is nothing short of an engineering revolution, and I for one will be rooting for it.
Much of the scepticism about the Nano quality and reliability reminds me of the scepticism that preceded the launch of Reliance mobile at 40 paise per minute, Deccan  Airways, etc. As events turned out, both of them changed the face of their respective industries. One can sense a similar big paradigm shift in the automobile sector.

Another interesting change will be witnessed in the used car market. Already organized players are making a presence. The Nano is likely to impact prices significantly. It will be interesting to watch this space.

Also waiting to see how the various governments respond to the demand for road infrastructure, which will surely follow the success of The Nano.

Last 5 posts by Amit Sinha

• The incentives for people to join politics needs to change - March 3rd, 2010
• Reducing Specific emission by 25% over 15 years - December 4th, 2009
• The big impact of NREGA - September 7th, 2009
• Big numbers boggle the mind - August 31st, 2009
• Monsoon has eluded north India - July 24th, 2009

Tags: automobile, Consumer markets, nano

This entry was posted on Wednesday, March 25th, 2009 at 1:44 pm and is filed under Consumer Markets. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.