Travel | ON THE ROAD

Cheap car shows poorer nations won't accept role as the First World's 'factory'

Two or three hundred journalists from around the world rushed to the stage, pushing and shoving each other to get a glimpse. Although the car had been announced more than three years earlier, such was the excitement.

The Nano, unveiled at the New Delhi Auto Show on Jan. 10, has redefined the rules of the global manufacturing industry. Emerging countries are no longer satisfied to merely duplicate products from the industrialized world, albeit with varying degrees of success. Nor are they happy to remain the cheap-labor “factory” for advanced nations. They intend to innovate, to respond to needs in emerging markets — and to set the global agenda whenever possible.

The world’s cheapest car, and the masterful media campaign that heralded it, has certainly inspired competitors the world over. Almost every automaker — including Toyota and Nissan in Japan, as well as Ford and GM in the United States — are seeking a new, low-cost mobility solution. Or, more precisely, a modern, low-cost mobility solution.

The Nano is not simply a stripped-down “third-world,” car but rather an authentic car for owners of two-wheelers who aspire to a better life. For about 1 lakh ($2,500), they get all the automotive standards and stereotypes: four wheels, five seats, a body frame and four doors. Everyone was expecting an engineering revolution in order to deliver the Nano’s low price tag — a feat never before accomplished in the auto industry. Nothing of the sort was required. The Nano is a distillation of tried-and-tested solutions, a fine balance of “back to basics” and “design to cost,” stretched to the extreme in manufacturing and distribution (buyers can even choose their car’s customized interior trim and finish, which local dealers deliver with practically zero investment by recycling existing parts and accessories from other cars or furniture).

The end product is a functional yet modern design in keeping with European styling tastes and bearing little resemblance to how the intellectuals and designers from London, Paris, New York or Tokyo would have imagined a third-world product — a basic transportation structure with four wheels. The car’s monoform design (where the cabin roominess is the key value to be conveyed) is effortlessly seamless — it adopts an innovative layout, with a rear-mounted engine, to maximize interior space while remaining surprisingly compact.

Neither has Tata Motors forgotten that in India, families are central to the vehicle’s needs: Five people can fit into the car, while a brand new, “lightweight” 624cc engine delivers around 30 hp, and the Nano easily reaches 80 kph.

The market for such a car is huge. As incomes grow in India, there are an estimated 2 million households each year that aspire to a car within this price range. These households have an income of around $5,000 to $6,000 a year and aspire to a safer means of transport and the peer recognition that comes with being a car owner. They are predominantly young families living in the cities or suburbs, and the four-wheeler they will own will be used mainly for family outings and the religious events that punctuate life in India.

But the market for the Nano extends beyond India to South America, members of the Association of Southeast Asian Nations and maybe even China. Here, it is instructive to reflect on the global market and its potential for growth. Under the tripartite pressures of global warming, energy shortages and the rise of the world’s most highly populated countries (China and India), the global market is diverging toward two extremes. The high end has its own benchmark brands with values that are common the world over, while the low end is yet to take form in a way that meets both expectations and economic realities; the products offered by “technologically advanced” world are incompatible with the income levels of the developing countries.

The Nano may seem to be a perfect product to meet demands at the low end of the global market, but the proliferation of cars in places such as India is alarming when the consequences are considered. India’s cities are asphyxiating, traffic is chaotic and infrastructure is inadequate or simply nonexistent. The population density there is also among the planet’s highest, and there has already been a sharp rise in the number of road fatalities and injuries. To all this add Tata’s annual production target for the Nano of 300,000 units, which is modest if you consider that the market for new cars in India alone is estimated at more than 1 million units a year. Perhaps Tata anticipates fierce competition in this low-price segment. But such competition can only result in more cars on the roads.

While this is of great concern to many people in rich countries, who are they to deny people in poorer nations access to a symbol of wealth or even happiness, through freedom and independence, that they now enjoy?

Two distinct approaches may help meet these current challenges, although neither should sacrifice any of the aesthetic or emotional criteria that will continue to shape the appeal of automobiles for a long time to come. One is the frugal approach as illustrated by the Nano, and the other is the high-tech approach favoring zero emissions in the form of hybrids and electric cars. The Nano cleverly demonstrates that one of these approaches is possible. Cheap to make, the Nano is also cheap to run, getting fuel efficiency of 20 km per liter. The car, therefore, not only uses up less of the planet’s precious resources, but it also pollutes less than most of those coming out of Europe, Japan and the U.S.

The other, high-tech approach is still in the making. But there is no doubt that the two approaches are set to coexist ever more as time goes on.

Phoebe Royce is an art/design expert working with several automakers who has been researching socio-contemporary attitudes and the car for the last 30 years.

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