Indian auto major Tata Motors have decided to suspend the production of the lower variants of the Tata Nano small car, on account of poor sales and to avoid inventory pile-up. The said move leads to the suspension of production of the CX and the LX variants of the Nano hatchback, until such time the company can gets rid of the existing stock lying with the dealers.
At the moment, the company plant in Sanand, Gujarat boasts of a capacity to build 2.5 lakh cars per year, but has been running for only four days a week due to low market demand. Earlier this week, we had reported that Tata Motors had announced the suspension of operations at its plant in Sanand where the Nano is manufactured for about 35 to 45 days on account of low demand for the vehicle. Also, the Indian automaker has reportedly, undertaken a retooling activity at the plant to manufacture the new Tata Nano model that is slated to arrive in the Indian market during the festive season.
In the month of May 2014, Tata Nano registered sales of only 1,001 units. At the start of the year, the Nano was able to bring home sales of 2,500 units per month, but the numbers just started dwindling post that. The Indian auto major has tried and tested several new marketing and advertising campaigns in order to boost the sales of the Nano small car in the past. So much so, that one can now buy a Tata Nano with a credit card. But the sales numbers have failed to pick up each time.
Nonetheless, Tata Motors is prepping a new and improved version of the Nano, which is speculated to attract a higher price tag than the current model and is expected to go on sale before the end of 2014. At the moment, the Tata Nano Twist retails at Rs 2.43 lakh in the Indian market (ex-showroom, New Delhi.)