Tata Nano - Is the world's cheapest car a blessing or a curse?
Today Tata Motors announced that the Tata Nano will be released in India in July, 2009. With a price tag of around $2,000, the Tata Nano is the cheapest car in the entire world. Will this innovation change the world for the better or the worse?
So far the demand for the Nano seems to be quite high since many Indian families desire a four wheeled car and the Nano's cheapest competition is about twice as expensive. The initial production of 100,000 vehicles will be sold by random drawing. Many Indians have already purchased an application to purchase the car, and Tata Motors is holding their deposits for the new vehicles. Those who do not receive a car in the first round will have to wait until more can be manufactured.
Although the Nano is being nicknamed as "The People's Car" for its affordability, there are opponents to how affordable this car is. Since the car is so cheap that so many Indians will be able to buy one, some fear that its launch will increase the congestion in the streets and also add to the already dense pollution in India. However, Tata argues that the Nano is one of the greener cars on the market due to its small size and low fuel consumption. Indeed, the Nano gets around 50 miles per gallon, and if it were to replace the many gas guzzlers we have in America we would actually reduce pollution. The flip side is that its cheap price may encourage waste in a country like America because people would tend to replace Nanos more quickly than they would replace more expensive cars.
I think a possible positive effect that will come from the introduction of the Nano is that many other car manufacturers will be working on creating cheaper cars to compete with the Nano. However, many of these cheaper cars will not be heading to Europe and the United States, and it is debatable whether cheaper is better.
The Nano is headed for Europe in 2011 and Tata Motors intends to sell it in other portions of South East Asia and perhaps eventually the United States. Currently, the cheapest new vehicle in the United States is either the Nissan Versa or Hyundai Accent, and both of these cost nearly $10,000 so if the Nano were available I imagine it would be very popular in this economic climate where everyone is trying to save money. What do you think? Would you purchase a Nano or one of its comparably priced competitors if it were available in your country? Do you think the availability of cheap motorvehicles will stunt the development of public transit and increase pollution?