Tata's Rs 1 Lakh Car ; Beating Incredible Odds, Ratan Tata's Tata Motors has Not Just Built Running Prototypes of the Ultra Low-Priced Car but Geared Up for a 2008 Launch. An Inside Look Into the Automotive Revolution It Could Unleash.

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Circa March, 2008; Venue: The Geneva Motor Show. Like every year, the 78-year-old automotive show is a big draw. More than 5,400 journalists, 750,000 visitors and 300-odd exhibitors have descended on the 114,000-sq. mt. exhibition ground. As usual, the automotive drool fest is spectacular: there are super-luxury cars on display that are bigger, shinier and faster than the ones year before; hybrid cars promise to become cheaper and even more environmentally- friendly, and a slew of nifty concept cars from the big manufacturers gives a peek into the automotive future-the small cars will rule. Yet, the biggest buzz is not about any of these cars. The talk of the show is the unveiling of the world's cheapest car, with a sticker price of $3,000 (Rs 1,32,000 at the current exchange rate). The manufacturer isn't Toyota, Suzuki or the French Citroen. It is a Pune-based company called Tata Motors, and the 6-feet-plus man standing next to it just can't stop beaming at the flashing cameras. Five years after he promised (incidentally, at the same show) to build the world's cheapest family car, Ratan Tata has delivered. Beating incredible odds once again, the Chairman of the Tata Group has built a car that could do to India what Henry Ford's mass production did to America in the first half of the 20th century. He's built Everyman's Car.

Sounds far-fetched? Possibly not. Even as this article is being written, engineers at Tata Motors' Engineering Research Centre (ERC) in Pune are putting a handful of Tata's "dream car" prototypes through its paces. Simultaneously, they are gearing up to productionise the car-that is, figuring out how to mass produce the successful prototype. Their target: Put India's cheapest car on the road by 2008. Says Tata, 67, who's personally overseeing not just the progress, but the making of the Rs 1-lakh car: "Yes, the prototypes of the car are running... (and) we have developed now what would be the structure of the car. My best estimate would be that in the next two-and-half to three years-by 2008-the car would be out."

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Tata's Rs 1 Lakh Car ; Beating Incredible Odds, Ratan Tata's Tata Motors has Not Just Built Running Prototypes of the Ultra Low-Priced Car but Geared Up for a 2008 Launch. An Inside Look Into the Automotive Revolution It Could Unleash.

Before we get into what the Tata engineers are up against, it's important to clarify a couple of things. First, the Rs 1-lakh price tag. Tata's actual statement, he says, was about building a car for "Rs 100,000 or so". The media, however, quickly dubbed it the Rs 1- lakh car and the figure stuck. "Rather than getting distressed (about it), I took it up as a challenge," says Tata, who did something similar when he led a truckmaker into the passenger car business with the Indica. What it means is that by the time the Tata small car hits the road, its price tag, bloated by inflation, may be between Rs 1.30 lakh and Rs 1.40 lakh, and may come in two or three variants, with the base model priced closer to the Rs 1-lakh target. (We'll see later in the story why Tata Motors can't price it any higher.)

Building a car for Rs 1 lakh, or even about, is much harder than it is romantic. For, everything about the car must be worked backwards from the self-set price target. To spell out the challenge that Tata engineers face, they must build a small car that's almost half the price of the world's cheapest car (the Maruti 800) but be at least as good if not better, and yet meet all the safety and emission norms. In fact, if there's any manufacturer in the world who could have built a car for Rs 1 lakh, it is the Suzuki-owned Marut...

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