New Delhi: Tata Motors’ aggressive push to tie up with public sector banks in the last few weeks is a clear strategy to strengthen its rural presence as these banks have significant market penetration in rural areas.
Tata Motors wants to pave the way for Nano's entry into tier 1 and tier 2 towns.
Tata Motors has tied up with the Punjab National Bank and a host of other PSU's like Corporation Bank, Central Bank, Bank of India and State Bank of Patiala.
Priced at over one Rs lakh, Tata Motots hopes the Nano will pull in significant volumes from non-metro towns.
These banks will make their finance schemes available not just at their branches but also at Tata Motors 329 sales touch points across the country.
This also marks a shift in vehicle financing from private to PSU banks, a move which began almost six-eight months ago when private banks decided to go slow on auto financing.
For instance, India’s largest car maker Maruti has seen its exposure to private banks drop to 30 per cent of total vehicle financing from 70 per cent in the last year-and-a-half.
Meanwhile, Tata motors in Q3 of financial year 09 saw its in-house vehicle financing arm constituting about 33.8 per cent while remaining 66 per cent was split between both PSU and private banks.
This is expected to change post the recent tie ups with PSU banks.