Now that the Nano here it will cost only you 2 rupees for every kilometer you drive. That's really cheap.
On the ride back, everyone in the Metro was discussing the (de)merits of this car (costs, pollution, increasing traffic). It struck me that most of the people travelling already own a car. In fact some of them were protesting that they had just bought a new car and now would not buy a new one for some time.
Their logic confounded me. In a city like Delhi, while initially there will be many takers for the Nano, as the Metro reaches to the far corners and connects the suburbs, the demand for small cars will reach a plateau. In fact it will be in cities like Kanpur or Pune where the public transport is in shambles or riding a two wheeler is no longer safe, this car will be a hit.
According to the New York Times however, the car is a boon for families that have been traveling on scooters for years. While I agree that the car has made it affordable to own a four wheeler, the costs of running a small car will still be much higher compared to a two wheeler which only costs you less that a rupee to a kilometer. And if you are driving alone 50 percent of the time, most two wheeler owners will continue with their vehicles
Actually the markets in India are so large it is impossible that the Nano will impact sales of either two wheelers or larger cars. Expensive bikes will be continued to be bought by bike enthusiasts. In larger cities the Nano might become a second car for the spouse or kids. The cheaper two wheelers will continue and so will cars like Santro and Alto. The Maruti 800 will be hit but in any case its engine was a little outdated.
However nothing to beat the Metro. No sir - not even the innovation of Tata can take away the fact that I can get to any place in half the time. Now maybe someone should think of a 5 lakh helicopter !!!
PS Will someone tell Bajaj that they will not be able to compete in the small car segment if they do not have their production systems in place. They have admitted that they will not deliver their small car this year. What was the point of the launch in 2008?