This Article is From Nov 25, 2011

Ratan Tata, Modi inaugurate Gujarat Nano plant

Ratan Tata, Modi inaugurate Gujarat Nano plant

Tata Motors opened a new chapter in its history on Wednesday by officially starting the production of Tata Nano from its new unit at Sanand in Gujarat on Wednesday. The new plant was inaugurated by Gujarat Chief Minister Narendra Modi and Tata Group Chairman Ratan Tata, who seven years ago dreamt of making an affordable family car for the common man.There was mutual admiration expressed loudly and repeatedly as Ratan Tata and Gujarat Chief Minister Narendra Modi inaugurated the Rs 2000-crore Nano plant at Sanand in Gujarat.

"Ratan Tata has promised to surprise me with more investment," said Modi. Minutes before that,  Tata expressed his thanks. "Narendra Modi stood out amongst all others, in giving us what we needed. We owe you a debt of gratitude.. Gujarat is an exemplary state, it makes us proud," he said.

Ratan Tata added, “We had to move under duress and we had to search for a new home for the plant. Mr Modi stood among others to guarantee whatever we needed. It gives me a great please to make this investment on the 50th year of the state”.

The production at the Gujarat plant starts nearly two years after it was forced to shift the manufacturing plant of its dream car following a land row in West Bengal. Tata Motors, which first chose Singur in West Bengal for setting up the mother plant, pulled out of the site in October 2008 following violent protests over land acquisition.

As it searched for a new site, the company went ahead with limited production of Nano - touted as the world's cheapest car with a factory gate price of Rs 100,000 (little over USD 2,000) - from other facilities. Bookings for the car opened in March 2009 and deliveries began in July that year.

According to company sources, about 30,000 Nano cars manufactured at its facilities in Pune and Pantnagar  have hit the road so far.  It was on October 7, 2008, that Ratan Tata announced in Gandhinagar his plan to shift the Nano plant from Singur to Sanand.  This followed the state government's efforts to attract the Nano facility by allotting nearly 1,100 acres of land for the project, complete with space for a vendor's park (ancillary units).  This was in addition to a host of concessions given by the state government to the project.

Spread over an area of about 1,100 acres, the new Sanand facility has been created at the cost of approximately Rs 2,000 crore. The company has set aside a significant chunk of land for over 35-odd vendors who will be working very closely to adhere to Just-in-Time supply process for Tata Motors which help the company keep cost low and operations efficient.

The Sanand facility has the capacity to manufacture 2.5 lakh units annually, which can subsequently be increased to 5 lakh units per annum. Pilot commercial production of Nano at Sanand has already begun.  Despite the delay in setting up the Nano plant, Tata Motors still has the first mover advantage. Since the launch of Nano, other car makers have also stated plans for a similar car – Bajaj Renault and General Motors to name the two.