If you think Tata Motors just has the Nano up its long sleeve, be prepared to be dazzled. India’s largest automotive player hasn’t let the recent financial slowdown blunt its vision or its hunger to excel in a rapidly evolving global automotive scenario. Proof of this came straight from the man who has been steering India’s most respected business house into an automotive powerhouse. Shalini Kapoor, HNN Business Editor, engaged Ratan Tata, chairman of Tata Motors, in a free-wheeling discussion on cars and projects beyond the Nano on the sidelines of the Geneva Motor Show. And if you are a petrol-head, don’t just drool on Jags and Alfa Romeos but be prepared for Maseratis and Ferraris and even more powerful variants on the Nano theme. Seems Tata’s grand auto-nomic strategy is finally beginning to pan out. Excerpts:
The Tata Nano is finally set to drive down Indian roads. What would be the next challenge, once it is launched on March 23?
Ratan Tata: I think the next challenge would be to live up to people’s aspirations. To make the experience of buying, owning, servicing and supporting the Nano different from what you might have experienced. At the same time, the challenge will also be to have people understand that the Nano is not a Honda, not a Toyota. It is a low-cost car and while there might not be any deficiencies, it might have some lack of refinement which will go with a low-cost product, but surely won’t be a deficiency as such. I don’t think there’s been a car in India that’s planned to be produced in this kind of volume. It is, therefore, important for us to maintain a sustained quality from our suppliers and our own ability to meet product standards. All these issues should be very challenging.
Knowing that Telco had tried to do a people’s car in the 1960s but had to wait till two decades plus for the Indica and now the Nano to give Indians a genuine home-built product, do you sense that you would have loved to do the Nano earlier or is this the right time?
I don’t know because I believe everything you do has its place in time. So in the ’60s, an idea of a people’s car would probably have been different from what it is today. Technologies were different, it is a difficult thing for me to answer. At that time in the ’60s, talking about a people’s car would have been something that is alien to the marketplace. Today, you can have a people’s car that can be done with confidence. So this car is… each new product has its place and time.
Rajiv Dube, president, passenger cars, Tata Motors, mentioned at the launch of the Xenon that Tata Motors is suffering from a problem of plenty—I am of course referring to the sustained new model excitement, and it’s a good problem to have in these days.
Yes, but it also has its challenges and we need to handle them well. So that is a big challenge and I hope we can live up to the expectation.
Is the Tata-Fiat partnership doing well?
Yes it is. It’s doing what it’s set up to do, and perhaps a little more. We are very happy with the relationship. It’s a relationship that’s not treading in rhythmic reversals. It’s a very open relationship based on what we’re trying to do.
Is it a possibility that you could pick and choose technologies available with your partner which you still might not have in the Tata Motors’ portfolio? Or is it something where you still have to go about trying to license that technology?
Naturally, the agreement doesn’t visualize gratis transfer of technology or products, but it does envisage the sharing of those openly. So we would expect that if there was some powertrain we thought would work well with our products we would certainly ask our partner and see whether it makes sense to do that given the transfer rights and licensing fees. Likewise, Sergio (Marchionne) has always made it very clear that he would like Tata Motors to be his preferred development partner and in that way we could share platforms and technology and also manufacturing practices. So the way we think, everything that Tata Motors makes and sells could be developed with Fiat.
Let me bring up the subject of Pininfarina in which Tata Motors has a small stake.
Having seen Tata Motors work with so many big names in product design and development, is this tieup with Pininfarina a harbinger of change as many think it would be the sole font of design for you on a regular basis from now on? Or would you still farm out design to others like I.DE.A. and Bertone who did the Indica and the new world truck cab respectively?
Very difficult to say because we have multiple sources of development. We have our own internal design group which I think has done a very admirable job, but lacks experience which we will gain over time. We also support a group of designers who were in I.DE.A. but they left and we have funded them and supported them and they do work for us on various projects. Supporting this is our own technical centre in the UK which is not exactly a design centre but is used more for packaging and engineering. And we will have a relationship with Pininfarina or with Italdesign or whoever else it might be. So I think that design is an open issue and there is no exclusivity.
The Prima is a fine example of what you always dreamed of having— a large saloon for India. Will it see the light of day as a series produced automobile?
Yes, we are striving to do just that. There is no way we could do a large luxury car today given our brand, our expertise and also low volumes. However, we could indeed develop a high-end saloon for India which is sleek yet robustly engineered.
Extending this line of thought, we could also contemplate a high spec version for Europe which could be built in Europe and equipped with a degree of luxury and refinement which the market expects.
Tata Motors has been showing concepts at Geneva regularly, especially the Aria coupe. However, this is the first time that I have heard of an edict from your end that says the company should only show cars which have a production possibility.
I think that edict was there three years ago. We were showing a lot of concept cars. I stopped that and said I will not allow any concept cars to be there unless they have production capabilities.
So the X-over which you had shown a couple of years ago would see the light of day as a series-production automobile?
Yes that’s right. In fact, it is in the final phase of product development right now.
And also, of course, the Nano Europa ?
Yes this is something we are developing. A slightly more powerful, better-equipped version to meet European regulations. It will, however, come at a higher price than the Indian version, yet will be competitively priced for Europe.
What does one expect the Nano Europa to pack in?
It will have a larger engine, better interiors with leather trim, a superior exterior finish, come with CVT transmission probably and have ABS and ESP as standard. It is still some time away. Our plan is to have it ready by 2011.
Let me touch a bit on Jaguar and Land-Rover. Many in India are passionate about them primarily because they have such a fantastic motorsport heritage. However, in recent years the lack of a sports car, say in the mould of a modern day E-Type, in the Jaguar portfolio confounds many. Given your own passion for high performance cars, let me ask you as to how far ahead is Jaguar on a sports car?
We’ve started work on a car which will be a roadster of the type Jaguar was known for—a two-seat roadster. This car is in the early stages of design sign-off, but I’m highly excited about what I see. So I take it that the market will be too and that we can deliver a car that will be faithful to Jaguar’s heritage.
What about Jaguar—Land Rover coming to India? And how are you geared towards that, as far as the distribution channel is concerned? That could be your biggest challenge…
I think previously, like any other brand, Jaguar and Land Rover haven’t had maybe a single importer in the country and therefore not very much money was spent on promoting the brands or doing much distribution. We hope to take over the distribution of both the brands. We’re going to have showrooms, service facilities and we will set up a proper channel to handle these brands.
Would this take the shape of a separate channel away from the Tata Motors effort?
It may or may not. If we look at our product range, we will say that we have SUVs, we have city cars. If you look at our ties with Fiat, in the course of time we will also represent Alfa followed by Maserati and eventually also Ferrari. So we may have multiple brands in the same showroom or we may have multiple brands in different showrooms, but they’ll still all be part of Tata Motors.
You among all Indian companies are really pushing the envelope on alternate fuels and the ecological side of things. Where do you see yourself hitting pay dirt with cars like the first Indica electric car, that you say will go on sale in a year’s time. For them, infrastructure and other technologies… would they really manifest themselves in India in the short term.
You know, I think just like you may say you need a small car or a big-sized car, different segments of the Indian public in different geographies will have different needs or preferences. There’s no doubt that biofuels at some point or flex-fuels are going to be the way the cars are going to be driven. So we should be able to develop cars that will be flex-fuelled. Thus, ethanol will be one of the bio-fuels that some of our cars would cater to using an E85 gasoline flex fuel base to begin with.
There will be a segment that will look at electric cars. We are not into hybrids, so we will not look at them, as yet. However, we are indeed looking at electric cars and the Indica we have here should be ready to sell in Europe from the next year. We are also looking whether it will make sense to get into battery manufacture, say lithium ion batteries and in course of time we’ll take a business decision on that.
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