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August 7, 2014

INDIA: Last minute factory switch hit Nano sales

Delays, caused by the shift of factory from Singur in West Bengal to Sanand in Gujarat, badly affected sales of Tata’s Nano budget car and its long term prospects.

Delays, caused by the shift of factory from Singur in West Bengal to Sanand in Gujarat, badly affected sales of Tata’s Nano budget car and its long term prospects.

Chairman emeritus, Ratan Tata, who stood down as the boss of the Indian carmaker at the end of 2012, told the Times of India: “When the project was announced, it had created world-wide excitement since it demolished the myth that no car could be produced under US$2,500. It attracted huge bookings [orders] and had a waiting list of two years.”

However, the original factory site was dogged by land ownership issues.

Tata added: “The decision to move the car factory to another location, at great risk of failing to find another site before it found a new home at Sanand, caused a delay in the project by almost a year.

“By that time, the excitement had ebbed. It caused disbelief about the product and gave competition time to bad mouth it. All this affected the longer term marketability of the Nano.”

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