Tata Motors Vice Chairman, Mr Ravi Kant, said last week that the company may allow enterprising assemblers across the country to set up ‘micro-assembly sites’ for the Tata Nano. Speaking at The Economist Innovation Conference in London, Mr Kant said that these assemblers would be allowed to re-brand the Nano, and call it whatever they liked. He also said that they would each produce approximately 10,000 cars a year.
The idea of distributed manufacturing was first put forward by Ratan Tata, when he talked about his desire to make a one-lakh rupee car. Auto industry experts, however, do not think that India is ready for such an idea. Customers make car-buying decisions based on several factors including brand value, safety concerns etc. In an arrangement where several independent assembly units operate in addition to the manufacturer’s main plant, there may be problems of branding, maintaining safety standards and also post-sales issues related to service and spare parts.
Tata Motors’ new plant in Sanand, Gujarat, will be operational in the first quarter of 2010, and will have an initial production capacity of 250,000 units an year.
This is not a bad idea. But will it work?