The Tato Nano is likely to wrest the leadership position in India’s small car segment within a year as the ruling market leaders – Maruti 800 and Omni – will be marginalised by tougher emissions rules, according to a consultant.
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A report in The Economic Times newspaper says that the evergreen Maruti 800 – based on a 1980s Suzuki Alto – will no longer be sold in eleven of India’s biggest cities from January 2010 because of failure to meet emission regulations.
“This [absence of Maruti 800 and Omni] would mean no direct competition to Nano. The important question is whether Tata Motors would be able to manufacture enough units of Nano that would meet the demand.” said Kapil Arora, Partner (Automobile), Ernst & Young.
The entry-level Maruti 800, the flagship product of Maruti Suzuki India, is priced at Rs 2.15 lakh. The basic version of the Nano is pegged at Rs 1.35 lakh though other versions with more features cost more.
“The pricing strategy of the product is not decided yet. The price of the Nano could go up. The margin at the moment is wafer thin, ” Arora added.
