Who Scared Br’er Rabbit?

he Nano has challengers. Many new contenders are coming in to carve a piece out of the mini-car space in India. Recently, the Bajaj group finalised its agreement for a much-talked-about mini-car with Nissan and Renault, which is likely to hit the roads in 2012. But before that, we may see market leader Maruti Suzuki launching yet another small offering by as early as January 2011. According to sources, the company has been working on the Cervo, which will be a small car similar in size to the Alto and priced just under it. This would provide a distinction from the Alto, which is undergoing a technology upgradation. Also in the wings is Hyundai Motors’ small car (currently codenamed H800), which is also likely to surface in early 2012. A slew of other automobile makers are also planning to test this space with offerings around the Rs 2 lakh mark or within striking distance of Nano’s price tag. The Alto, priced a little above Rs 2 lakh, is India’s highest selling car now.

Complicating matters is a mellowing of the initial euphoria around the Nano. Of the 2.06 lakh initial bookings, 1 lakh were chosen for delivery in the first lot. Of the remaining, only 55,000 finally retained their bookings. Now with its Sanand plant fully operational, the company plans to reach these remaining customers, but is yet to reopen bookings for the vehicle. When that happens, Nano’s real strength will be visible. With smaller, cheaper options around the corner, and the price advantage eroding, Nano may need to prove a thing or two before Indian customers.