Launching World Smallest Car in Cheapest Price

Fireworks blossomed on giant video screens, the 2001: A Space Odyssey theme reached its brassy peak, and the world’s most affordable car—the $2500 Tata Nano—rolled out onto the stage. Ratan Tata, chairman of the Tata Group, parked and got out as hundreds of camera flashes speckled the darkened convention hall. If the pageantry seemed excessive, this wasn’t the time to complain. Here at the 2008 AutoExpo in India, the Nano’s debut was about much more than a car. The Nano, many tradeshow attendees seemed to believe, would transform the country and then, maybe, the world.

From where I stood, crushed between an elbow-throwing television reporter and three teenagers, also jockeying for position and armed with cellphone cameras, the Nano looked underwhelming. Automotive journalists had traveled from the four corners of the globe too see a golf cart crossed with a jelly bean. Its journey onto the stage and into history was powered by a 2-cylinder, 33-hp engine, and the spec sheet is best given as what the car has not: no air conditioning, no radio, no power steering, no sun visors. But it carries four people, gets 50 mpg, and costs less than a trendy motor scooter. All of these facts had been leaked before the official presentation. What the public didn’t know until now was that the Nano, without needing to be, was designed cute—sleek, simple and glassy, a pleasant pod car straight out of 1960s sci-fi.

Ratan Tata answered questions later at a press conference for foreign journalists. Here was an exceptionally powerful man—“to us, he is a king,” one attendee told me—cheerfully fielding inanities. Most of them were variants on the same theme:

“Will you be releasing the Nano in the U.K?” “No we don’t have any plans for that at this time.”

“When you release the Nano in the U.K., how much will you charge?” “But I just said that we wouldn’t. Next question.”

“Will you be releasing the Nano in Japan?”

And so on. (For the record, the car will be released in India only; in a few years it may be sold in other developing markets such as Latin America or Africa.)

I wandered back to the display halls. Fiat, Ford, Volkswagen. Bright stage lights; gleaming car bodies buffed by men with white shammies; the obligatory car show babes with toned legs and smiles frozen in faces of wax—this land of automotive fantasy was a jarring break from the city outside the convention hall. The world may be flat, but India’s roads are bumpy. They are often dirty with trash and sodden with human waste, gridlock-crammed with bicycles, motorcycles, rickshaws, cars, cows, busses, men towing carts and women carrying runny-nosed infants between the lanes and begging for rupees. The press has rightly touted the astonishing growth of the Indian middle class to more than 300 million people, but sometimes overlooks the 700 million who still live on $2 or less per day.

The Nano is no solution to the traffic problem in big cities; a prominent Indian environmentalist called the prospect of these ultra-affordable vehicles flooding the roads a “nightmare.” But the Nano represents both national pride about India’s ingenuity and the promise that the benefits of middle-class life will reach more people. “What can you get for $2500 in the U.S.?” a young man named Hemant Chagh asked me. “You can’t carry your family for $2500 in a car. But in India we have done this.” His friend, Rajesh Relia, agreed. He makes 6000 rupees a month, about $150, working in a factory that makes cassette tapes. He doesn’t own a car, and carries his family of four, dangerously and cumbersomely, on a motor scooter. The Nano is a car he can actually afford, and he said he will buy one as soon as it becomes available in late 2008. “This is my dream,” he said, beaming toward the stage. “I am very happy today.”