Tata Motors plans new car from Sanand plant, awaits Govt sanctions

Tata Motors wishes to produce a new car from their plant in Sanand, Gujarat and are in talks with the Gujarat Government for the same. The current contract which the company has with Government of Gujarat is only extended to production of Nano with incentives granted to the company on the form of soft loans which are based on Value Added Tax paid on the sale of Nano.

Tata Motors plans new car from Sanand plant, awaits Govt sanctionsTata Motors’ entry into Gujarat evinced added interest from other automakers such as Maruti Suzuki India Limited and Ford India Pvt. Ltd who have followed Tata Motors into Gujarat. The Government of Gujarat has not limited production to any particular model where these two automakers are concerned and hence Tata Motors wishes to produce a new car from their Sanand Plant.

Sanand plant has an installed capacity of 250,000 cars per annum. Following lukewarm response to the Nano, sales of which have dropped 23% to 3,029 units in three months, averaging to just 1,000 units per month, this facility is vastly underutilized which has prompted the company to add one more car to production lines, reveals Business Standard.

With the Zest, Bolt and production of an all new car called Kite all part of the company’s HorizonNext strategy, the company wishes to bring out a new car from Sanand plant which has been developed as a world class facility. All attempts made to boost sales of the Nano by taking away its cheapest tag and repositioning the Nano as a smart city car with added features such as power steering, has failed to bring in desired results and hence utilization of Sanand factory for another model will be more feasible.

via Business Standard