India to Debut World’s Cheapest Car

Daily News Article   —   Posted on March 31, 2009

NOTE: This article was first posted March 30th at WashingtonTimes.com.

(by Daniel Pepper, WashingtonTimes.com) NEW DELHI – The streets of Indian cities are clogged with noisy conveyances – hulking buses, cars, carts pulled by braying bullocks and motorbikes pyramided with passengers. Commuters idle angrily in traffic for hours each day.

With a long string of mass transit projects, the government is trying to solve the problem. But many Indians yearn for the status, peace and luxury of a car they can call their own.

Tata Motors in Mumbai is set to answer that call by rolling out the world’s cheapest car in April. The company has global ambitions for its $2,000 Tata Nano, a gasoline-powered, air-conditioned five-seater. But environmental activists say the vehicle will be a big polluter of India´s already smog-filled air.

So why isn’t India’s other automotive wonder – the electric Reva – getting the same attention? The Reva is the world’s most successful electric vehicle. It has been on the market longer, sold more cars and been driven more miles than any other electric vehicle in the world.

The Reva, manufactured near the city of Bangalore, has a sales tally of at least 3,000 cars since it was launched in 2001. It has been driven a combined 34 million miles in 20 major cities in Asia, Europe and South America.

But despite patented technologies, government subsidies, a groundswell of interest in electric vehicles and innovative marketing practices, the Reva is unlikely to put a dent in the global market with as much force as the Nano because the environmentally friendly, near-silent plug-in car costs three times as much as the Nano and has only a limited appeal for cash- and credit-strapped first-time car buyers.

“It is very much a second car in the household,” said Chetan Maini, the company´s chief technology officer, who once raced a solar-powered vehicle across Australia.

Mr. Maini points out that five years ago, 22 percent of cars sold in India were a second vehicle; today that number is nearly 40 percent. “The highest growth is in the second-car buyer [market].”

Mr. Maini, who has a master’s degree in mechanical engineering from Stanford University, worked on electric cars in California. He relocated to Bangalore in 1999 after the California Air Resources Board reversed a 1990 mandate that 10 percent of new cars sold in the state should be nonpolluting. In India, he launched the Reva in 2001, exporting to Europe three years later.

If the Reva were sold in the United States, it would be significantly cheaper – about half the cost – of General Motors’ Volt, the highly anticipated electric-gas vehicle that is expected to reach showrooms in November 2010. Analysts estimate the Volt will cost between $30,000 and $40,000 – the price of 15 Tata Nanos.

About the size of a standard Indian auto-rickshaw, the 8-foot long, two-door Reva hatchback seats two comfortably – more uncomfortably.

The current version of the car, the Reva-i has a top speed of about 50 mph and requires eight hours for a full charge and 2 1/2 hours for an 80 percent charge. Long charge times make owning the car a challenge for buyers who live in apartment buildings and without access to a dedicated outlet. The car has a range of about 50 miles on a full charge [but is soon launching a model with a range of about 75 miles and faster charging times, so that drivers an get a 90 percent charge in one hour, and with a top speed of 65 mph.]

The price of the Reva varies, according to the country in which its driven. In New Delhi, considerable tax breaks, rebates and subsidies bring the car’s price to about $6,000, making it one of the most affordable places to buy the car. In Ireland, it costs closer to $20,000.

The newest version of the Reva, due out in May or June, with lithium-ion batteries and a solar panel on the roof, will cost about $14,500 in India. Unlike the much-anticipated GM Volt, due out late next year, the Reva is all electric, with no gas option. Reva sold about 500 cars last year and expects to triple sales this year.

Like many European models, strict safety and testing regulations make the cost of entering the U.S. market prohibitively expensive.

“Our next-generation products might be able to fit that bill,” according to Mr. Maini, who said the company plans to introduce a new model every year.

…………………….

Despite the current global economic slowdown, Reva is near completion of a state-of-the-art plant in Bangalore, India, with a capacity to produce 30,000 cars a year. Currently there are more than 3,000 Reva cars in production. In contrast, Tata plans to churn out nearly 250,000 Nanos in its first year of production.

……………………. (Read the article in its entirety at washingtontimes.com/news/2009/mar/30/indias-second-car.)

Copyright 2009 News World Communications, Inc.  Reprinted with permission of the Washington Times.  For educational purposes only.  This reprint does not constitute or imply any endorsement or sponsorship of any product, service, company or organization.  Visit the website at www.washingtontimes.com.

Questions

1. a) When will Tata Motors in India begin selling its gasoline-powered, five-seater Nano?
b) What will the Nano cost?

2. Who is opposed to the production and sale of the Nano? Why?

3. a) What is the Reva?
b) How many Revas have been sold since it was launched 8 years ago?
c) Do you consider this number successful?  Explain your answer.

4. Despite government subsidies for the Reva, and interest in this type of car, why is the Nano likely to far outsell the Reva?

5. a) Compare the number of gas-powered Nanos to electric-powered Revas expected to be sold in India in the coming year.
b) What inconveniences associated with the Reva (and other electric cars) might keep sales low?

6. Do you support the sale of the gasoline-powered Nano to give Indians the ability to own their own car? Explain your answer.

7. Will the electric car ever replace fuel powered cars? Explain your answer.

8. Do you think that President Obama will mandate (order) all automobiles sold in the U.S. to be electric?  (Ask a parent about the President’s new requirements for the types of cars General Motors must produce.)

9. If the cost of an electric car was equal to that of a gasoline-powered car, which would you prefer to buy? Explain your answer. Ask a parent the same question.


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Resources

Read about the Nano at the Tata Motors website.