Will the Nano Sell in Europe?

By Alex Ricciuti

02.26.2008

Tata has announced that it will bring the Nano to Europe in 4 years. A good guess is the price tag will be somewhat higher than the 1,800 euros of the model launched in India earlier this year. Tata Motors would have to bring the car up to European safety and emissions standards and that in itself will add considerably to the price of the car. Of course, when you are starting from such a low base-line, it will likely still be the cheapest new car on the block.
The question is, will it sell? Or maybe, there are several questions. Like, if there is a market for ultra-cheap cars, will this invite competition? Or is the Nano just plain too small for Europeans?
Many parts of Europe are densely populated, yes, but mostly in the wealthier markets in Western Europe where such a cheap car is not necessarily a draw. And in Eastern Europe, where micro-models such as the Chevy Matiz find a market, will the Nano have competition that offers more room and better quality? After all, there are very few places in the world where drivers have to share road space as much they do in India.
If Tata really wants to enter the European market and succeed, do they really want to be known only for making the absolute cheapest car? Is that the wisest strategy? Add in the impending purchase of Jaguar and Land Rover by Tata, and it really highlights the whole issue of brand strategy for Tata. If you have a cost advantage in manufacturing there are plenty of ways to exploit that without defining your brand so lowly. Maybe they should aim a little higher and look at how the Korean brands Kia and Hyundai have quickly mimicked the success of Japanese automakers in the West. There is a model there to follow.
Alex Ricciuti is a freelance writer and automotive journalist based in Zurich, Switzerland. He writes frequently for Automotive News Europe and others. He also writes on all things automotive on his own blog at eurocarguy.blogspot.com.
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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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3 Comments

  1. It’s a conundrum. Should you sell a 3000 euro car (Tata Nano) under the same brand umbrella as a 100,000 euro car (Jaguar)?

    Most experts would say no way, but Toyota has a pretty big gap between their lowest-priced car and their highest price Lexus, and everyone is aware that Lexus is owned and run by Toyota.

  2. Such a car would do very well in the former USSR bloc nations.

  3. ….at the rate the US dollar is going these days the Nano could do rather well in the US too…

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