Friday, January 11, 2008

Nano: Tata’s 1 lakh car

Yesterday, Tata unveiled its 1 lakh car. It comes as great news. It was a much awaited event. Nobody knew if Tata would do it. There were doubts abound – in media, in people and with analysts. And all the details were kept secret till the last day. At last! The car has arrived – in all grandeur and splendor. And keeping all its promises!

Tata, an Indian company, has made world’s cheapest car. It is no ordinary feat! Making the cheapest car is not about being cheap. When you have a car that does everything what others do but yet is very cheap, it is an engineering and business marvel. While making it, one has to go back to the drawing board and relook at every strategy that you knew about car making and then ask yourself, ‘Is there a cheaper way of doing it, and yet retaining its function?’ It’s an ideology that you have to embrace in your thinking – in business and engineering. That is what Ratan Tata and Tata has done. And it’s a great achievement.

Maruti-Suzuki, the biggest car seller in India, conceded that they cannot put together a car for Rs. 1 Lakh, and went onto add that it’s an impossible task. Congratulations to Tata, Ratan Tata, and all the engineers, managers, workmen who made this impossible feat possible!

Promises kept

Yes, it is an engineering feat. Yes, it is a good business execution. But what is more important is that Rata Tata, who promised four years ago that he would give us 1 lakh car, has kept his promise.

“After all a promise is a promise,” Ratan Tata said, clarifying that it was not he but the media that mentioned the Rs.1 lakh price tag. “But I took it as a challenge,” the doyen of Indian industry disclosed.

In a country where most leaders promise and then go back on their promise, Rata Tata stuck to his promise and delivered it on it.

Few years ago, when his promise appeared in the news many people dismissed it. Even I did not think it would be possible. I thought this car may not transpire in the end – who knows, right? We have seen so many empty promises in our life – we don’t know which one to take seriously and which one to ignore.

But then, my wife really believed it. When I asked her to drive our car, she said, it was big for her, and that she was waiting for Tata’s 1 lakh car. Hesitatingly, I said, ‘what if it doesn’t happen?’ She didn’t have any doubts. She was quite confident that it would happen. Innocently, she said, ‘Tata said it himself. He said he would release the car. If he said it, he would do it’. I smiled to myself. I let her believe it.

Yesterday, the minute I saw the news on TV, I called her from the airport. She was quite excited. She told me, ‘Look, I told you so. Ratan Tata said he would do it. He did it’.

Thank you, Mr. Ratan Tata, for holding onto your promise. You have a believer in my wife!

On Business Leadership

That’s what leadership is all about. It’s the ability to keep your promises. The business throws too many ‘realities’ at you, but yet you keep your promise.

Ratan Tata, in another piece of news, has commissioned his team to create a low-cost water purifier. When asked what he would do next, he replied:

“Anything that we can do to reduce disparity.”

I am glad we have such people with us. I am glad we have such accomplishments to take pride in.

[There are personal reasons why I am happy today. Ratan Tata has corroborated some of my beliefs that set me on my own expedition. I hope I am able to write those reasons some day.]


  1. what nonsense! while ratan tata may have the integrity to keep his promise, this is the worst thing that can happen to india..with its overcrowded metros and population. see what happened in, everyone is going to buy a car and the streets are going to be chockful of noise pollution AND air pollution.

    a one lakh car does not reduce disparities..what utter drivel! a car has maintainence, petrol costs, insurance...not to mention the cost of DRIVING IT AROUND on congested streets. while top notch cities..some of the richest in the world like nyc, san francisco, paris etc are relying on public transportation, india goes back to ruining itself because of some misguided notion that every indian driving a car will reduce the disparity in the country...

    india is set to go to hell in a handbasket ... at 5 km/hour. and because of 'do-gooders' and useless promises and the so called 'intellectual/scientific minded' cheerleaders.

  2. Sujai,
    Nice to see you have started seeing beauty in India and Indians.

  3. May be it will be an alternative for the bikes, auto’s (hope, without heated up meter). and obvsly, scrwng up traffic and bulging the parking lots..

  4. What a unique moment for Indian industry! We may have finally crossed a psychological barrier by becoming pioneers in a human endeavor. And what a barrier it is! I can scarcely imagine the pride , the confidence which must be running through the entire nano team, a confidence based on a tangible product in front of their very eyes.

  5. With apologies to Robert Frost:

    The roads are narrow, congested and loud horns that beep.
    But Ratan's was the promise to keep,
    At a snail's pace the Nanos creep,
    And 2 miles to go in 30 minutes as I weep.

    There will be *plenty* of time for all to contemplate on the meaning of life, Ratan Tata's promise, where India is going etc. etc. as people breathe in the fumes sitting in their Nanos. So thank you Ratan Tata, for giving us Indians an opportunity to think that was seriously lacking in our lives.

  6. Chirkut-

    So, when I criticize India and Indians, you call it 'discouragement'. And when I celebrate something from India you jump right in to make a mockery of that.

    You need to get over this obsession to counter everything I say and get a life.

  7. Do you not have a sense of humor? Are you an objectivist, by any chance? ;)

    No, I just thought I'd present some points that maybe you missed. I don't claim to be an expert - but between both of us, I think we have it all covered. :)

  8. Sujai: Thanks for a nice article. It is a great moment indeed. It will get even better when Tata buys Land Rover and Jaguar.

    - Bodhiswaha.

  9. Ratan Tata has corroborated some of my beliefs that set me on my own expedition.

    It does not look like that for reservation at least - read - Reservation will divide the country: Ratan Tata

    everely criticising the proposed move to introduce reservation in top educational institutions, Tata Group chairman Ratan Tata on Friday warned the government that such a policy would ‘divide’ the country.

    [...] even opposed the move for job reservation in the private sector.

  10. Well. It just so happens that I differ with Ratan Tata on the subject of Reservations (there could be more).

    I would continue to like him for his business leadership.

    Who said that we need to agree on every topic under the sun? ;-)

  11. Is there a cheaper way of doing it, and yet retaining its function?’ It’s an ideology that you have to embrace in your thinking – in business and engineering

    May be this has to be adapted by Indian Engineers, whose brain has been flattened by our culture and education. For a passionate engineer, above ideology is very demoralizing.

  12. Who said that we need to agree on every topic under the sun? ;-)

    That is exactly why, despite all your dirty ideas I keep on reading and posting on your blog, since you have do have some good things also that you talk about sometime. ;)

    A quick question: Do you support and "follow" reservation in private sector? Do you think the cost advantage and the operational efficiency which is required for a 1 Lakh car could be achieved with "reservation"?

  13. Sujai,
    In my comments, I did not say that this is not an achievement for India, nor did I criticize you for what you wrote, or the points you made.

    But you often write about and criticize the condition of roads in B'lore, and I think other cities probably have a similar problem. So, given the roads, add a cheap car and it doesn't take a genius to figure out what will happen next. In cities. I think in rural and less urban places, it'll be fine for a while till the traffic increases and the roads will need to be widened.

    We have a somewhat different viewpoint - I come from the environmental angle which I place higher up than you do. And from that POV, what I wrote in my earlier comment is a no-brainer. What big cities need is a competent and efficient public transport system, similar to Delhi Metro, more than Nano. Which is not to say that Nano won't make life easier for some - it will.

  14. Do you think the cost advantage and the operational efficiency which is required for a 1 Lakh car could be achieved with "reservation"?

    YES. A resounding Yes.

    If I am an able leader, yes, I can work with an engineer with 87.5% and also one with 53.5%.

    And if the second guy came under 'reservations', then you have my answer.

  15. bhanu:

    I did not quite get what you meant by:

    For a passionate engineer, above ideology is very demoralizing.

    Can you care to elaborate?

  16. I can work with an engineer with 87.5% and also one with 53.5%.

    What do you mean by 87.5% and 53.5%? What are these percentages? All right, so that means you do support and follow reservation in private sector and that means you do employ certain percentage of "reservations" candidates in your enterprise. That is good to hear. It would be great if you could write a Blog about how you do that so others could benefit. Prima facie, it looks good but I guess the devil is in the details.

    Another similar concepts are propagated by Prof Prahalad (from Michigan) in Bottom of the Pyramid product designs and business models.

  17. Sujai,

    An engineer's dream is to build a brand new system with cutting edge technology. Asking him(no sexism here. Almost all the top engineers are male) to build a cheaper system is like asking a Ferrari Driver to run a bullock cart.

    May be this cost cutting is paramount to our poor companies, both in intellect and cash, whose sole strength is cheap labour.

  18. Sujai, one last thing. You might want to look into the obesity epidemic in the US and the role of "car culture" (among other factors) in contributing to it. Every issue has pros and cons. Communities in the US have realized the negative effects of car-friendly culture and are making efforts to reduce the over-dependence on cars, and promote walking, biking, physical activity, public transportation etc. I have first-hand knowledge of this because of my past work.

    But I guess India will have to go through the same cycle and make the same mistakes instead of learning from the mistakes of others. That's just human nature/life.

  19. bhanu

    What disregard of engineering history! Henry Ford is legendary precisely because he made the cheapest mass produced car of his times.

    Robert Noyce , founder of Intel made his bones inventing an integrated circuit which could be mass produced and we are all grateful for his invention.

    Look around and you will find many other examples of such feats which have made lives better for multitudes and needed significant engineering innovation.

  20. That was indeed a great achievement . We should be proud of this .
    Good Post.


  21. Tata has done all Indians proud. He is a real 'Bharat Ratan'. But no politician has spoken for him as one deserving India's highest award on Republic Day. On the contrary, the usual bickering has stared to give the award to politicians!

    This is the paradox that India is! Bharat Ratan and Bharat Patan co-existing happily!

  22. how how how is this the worst thing to affect India??
    jellicles is saying that we should suppress all innovation if it isnt useful at the time.tata's have introduced a car which fits in the range of a common man.
    the answer to the congestion problem is better road development and city planning.

  23. Sujai,

    But give a careful stare at those feats. They all were deeds, that were aimed at capturing the market, and not pushing the engineering to next level.

  24. Hi Sujai, great to see this post. A couple of days ago I myself wrote an essay on the Tata Nano. I thought to myself ... what is Sujai's opinion on this matter. Sure enough, you have a post on the Nano. As is often the case, I share your sentiments completely!! Do check out what I wrote here.

  25. We do have this craze for Cars - The bade paisonwallah's synderome. We feel and believe that the car, more than the utility part of it (Lets accept this, even if we travel by taxi daily to and from office we would still save a lot of money instead of going by car with all its maintenance and running costs and upgrade-to-better costs), would be an excellent social symbol of prosperity. Its interesting to see how far some ppl can go in showing off to others how rich or better they are.But Atleast they believe that something would make life better and they are clear about this.

    But I would rather wait for Maruti to lower the prices. 600 CC/100 Kmph/No-Power steering is not my idea of comfort in a car. And fuel efficiency is not the biggest reason to drive the sales of car.

    Destination Infinity.

  26. good that now we have a cheapest.but my question is? WHY TATA..why dont indian people do something like this..why always only business houses are looked upon where the business has become a hereditary tradition.


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