Click to play videoNew Delhi: With the Singur deadlock far from over, does Ratan Tata's promise of a Rs 1-lakh Nano car and an October delivery look like a far fetched dream?
"A standard car will in fact have a dealer price of Rs 1 lakh only. VAT and transport being extra. Now having said that I just want to say that is because a promise is a promise," Ratan Tata, Chairman, Tata Group, had said on January 10 at the Auto Expo 2008 in New Delhi.
Tata was only reiterating his promise he made more than a decade ago but since then much has changed. According to analysts, Tata Motors and its vendors are losing close to Rs 1 crore for every day that work is stalled at Singur.
So despite cost skyrocketing and increasing raw material cost will the Chairman of Tata Group be able to stick to his promise?
"The way Ratan Tata has been carrying on with his proceeding as of all that has happened in West Bengal, I am quite sure he will insist and maintain the price," analyst Betrand D'Souza says.
But the delay at Singur has taken a toll on the cost of the project, which has already run upto Rs 1,800 crore from its earlier estimate of Rs 1,500 crore. If Tatas have to relocate from Singur then the price will go even higher.
While Tata Motors appear ready to absorb the cost, it is the 55 vendors supplying accessories to the Nano who may have to pass on the hike in prices.
"If the factory is shifted from there, first the vendors who are located there would have to rethink their plans. They might have to and the investment they have made and the people they are employing will have to be rethought of. Second, the other vendors who may not have been located there but located some where else would now need to tie up logistics to another venue, another location," says Dilip Chenoy, Director General, Society of Indian Automobile Manufacturers.
While Ratan Tata and his team will try their best to deliver but it remains to be seen whether the Singur stalemate extracts to high a price for the Nano to stick to its Rs 1 lakh promise.
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