Skip to navigationSkip to content

It’s time to say ta-ta to the world’s cheapest car

By Kamalika Ghosh
Published Last updated This article is more than 2 years old.

The idea of the world’s cheapest car was conceived by Ratan Tata on a rainy day after he saw a family of four on a bike.

“The fact of unsafe travel was bothering me,” Tata, the erstwhile chairman of the Tata group recalled in an interview in March 2011. “What really motivated me…was constantly seeing Indian families riding on scooters, four or five on a scooter, maybe the child sandwiched between the mother and father…on slippery roads in the dark.”

Now, after a nine-year run, the Nano is ready to drive into the sunset, with the Tatas announcing earlier this month that the car will henceforth be produced only on demand.

It was in 2003 that Ratan Tata set out on his quest for the affordable car—later christened the Nano—using the resources of the group’s car company, Tata Motors.

Nano did not just rewrite the story of affordable cars, it also altered the 34-year-old political history of the Indian state of West Bengal. The company decided to build its plant in Singur in 2006, about 50 kilometres from the state capital Kolkata. Tata Motors planned to invest up to Rs2,000 crore and turn Singur into an auto city.

Reuters/Tata Motors/Handout
The interior of the Tata Motors plant in Singur, West Bengal.

To set up its sprawling factory, the then Communist Party of India-Marxist (CPIM) government of West Bengal sought to take over 997 acres of fertile farmland, sparking a severe backlash.

Widespread protests broke out across the state, leading to the ouster of the communists after over three decades in power. The state soon got its first woman chief minister in Mamata Banerjee who had spearheaded the Nano protests.

Reuters/Jayanta Shaw
Mamata Banerjee (5th from right) marches with party activists during a protest rally in front of Tata Motors’ small car project.
Reuters/Jayanta Shaw
Activists scuffle with police during a protest in Kolkata, West Bengal, in 2006 after the charred body of a 19-year-old female was found on farmland acquired by the Tatas for the Nano plant.

Given the political turbulence in West Bengal, the Tatas, in October 2008, shifted the Nano factory to Sanand in Gujarat whose chief minister Narendra Modi reportedly approved the project over just an SMS.

Reuters/Amit Dave
Tata Nano automobiles are seen parked at the carmaker’s plant in Sanand, Gujarat.

Finally, in 2009, the car was launched in two variants: a basic model priced at Rs1,12,735 and the luxury version costing Rs1,70,335.

The launch of one of the world’s smallest cars sparked unprecedented euphoria in India and significant excitement across the world.

Ratan Tata (L), chairman of the Tata Group, and Gujarat’s then chief minister Narendra Modi.
AP Photo/Rajanish Kakade
Ashok Vichare (right), owner of the first Tata Nano, with Ratan Tata.

In 2010, around 9,000 units of the Nano were sold. Since then, however, things have been on a downhill.

By 2011, Tata Motors was selling a mere 500 units a year. This drop in sales can be attributed to various reasons, the foremost being safety. In 2010, a Nano caught fire in Mumbai and over the next few months, several such incidents were reported.

AP Photo
A brand new silver Tata Nano caught fire in Mumbai.
Reuters/Danish Siddiqui
A Tata Nano car made of gold in Mumbai September 19, 2011.

Moreover, the stigma of buying the “cheapest car” proved to be its undoing.

“It became termed as a cheapest car by the public and, I am sorry to say, by ourselves, not by me, but the company when it was marketing it. I think that is unfortunate,” Tata later admitted.

In June 2018, only three Nanos were sold and just one produced at Sanand. The curtains may have finally come down on a grand experiment in the Indian automobile sector.

An idea born on a rainy day seems to have broken down irreparably by the rains in 2018.

📬 Kick off each morning with coffee and the Daily Brief (BYO coffee).

By providing your email, you agree to the Quartz Privacy Policy.