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Tata Nano Bangladesh launch deferred

By Motortrend India Staff   |   16 October,2011

The launch of India’s Tata Nano, billed as the world’s cheapest car, was delayed at the last moment in Bangladesh after its distributor said Saturday it was seeking a cut in price.

Nitol Motors, Tata’s sole distributor in Bangladesh, was due to launch the car at a fair on Saturday but high taxes meant the price tag for the least expensive no-frills Nano would be 599,000 taka ($7,900). That compares to 141,000 rupees ($2,870) for a basic Nano model in India.

“A lot of people came to us for booking at the fair. At least 23 people confirmed their interest,” said Abdul Matlub Ahmad, director of Nitol Motors

“But we’ve deferred launch of Nano at the last moment as we’re seeking a re-look at the price, which some say is too high.”

Both the Nano and other small cars produced by foreign companies such as Maruti are significantly more expensive in Bangladesh as importers have to pay 132 percent tax on each car, he said.

“We anticipate the Nano will be very popular because it is extremely fuel efficient. You can drive more than 25 kilometres (15.5 miles) with a litre of gasoline,” he added.

Fuel prices have risen sharply in Bangladesh over the past year due to rising global costs and the phasing out of government subsidies as Dhaka struggles to rein in its soaring imports bill.

The Tata Nano, billed by the company as the “people’s car”, generated worldwide interest when it rolled off the assembly line in 2008, and the company is already marketing it in Sri Lanka.

When the Nano first appeared in showrooms, it was expected to create a vast new market segment in India, a nation of 1.2 billion people. But its sales have fallen far short of hopes.

Analysts attributed the Nano’s poor sales performance in India to concerns over safety, lack of cheap financing and operational hiccups after production shifted to a new plant. Last year, Tata Motors was forced to offer free safety upgrades after around half a dozen of the cars caught fire.

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