The Hindu Business Line : The making of the Nano

It was no small challenge to conceive, design and build the small car. Conventional ideas were turned on the head, the very definition of a car was re-examined and the design went through several iterations before it was frozen in the form that you now see.

The design team was aware at the very start of the process that the car had to look, feel and drive like, well, a car. There were no corners to cut. Though there are personal four-wheel vehicles that look and resemble a car, like for instance, the quadricycles that you see in Europe that run on a 500 cc engine, the small car could not be based on that.

The Mercedes Smart was a cute little “small car” but it came at a not-so-small price of €9,000 (approximately Rs 5.21 lakhs). Other successful small cars such as the Beetle and the Mini were designed without compromises. The Tata small car had to be similarly designed.

If the cost for the customer was Rs 1 lakh, then the target price for Tata Motors was around Rs 65,000 per unit, after excluding taxes and duties and the dealer margin. That was the cost target that the company’s engineers had to work at. To achieve this the company had to have control over every component that went into the car.

So how do you cut costs without compromising on design? One of the first ideas was to make the car modular in design with a space frame and plastic panels that could be shipped across the country and assembled. But it was given up because modern automotive concepts are not garage concepts. One cannot make high volume cars without the discipline of systems though that drives up the investment.

The search for plastic as body panels was continued though. Some of the best global suppliers of plastics were brought in (including GE) in the search for utilising the best concepts, processes and materials in the world.

However, it is believed that a truly radical solution was not economically practical. The idea of having a space frame as the structure and the plastic panels as cover was then given up and the team went back to the conventional sheet metal. But once the team plumped for the stamped sheet metal body to be welded and painted, the investment numbers went up for that called for a press shop, a weld shop and a paint shop.

Given these investments viability would require producing no fewer than 250,000 cars per year for a normal price car; for a one-lakh rupee car the breakeven would be higher at 350,000-400,000 units. A car every 45 seconds…. so Tata Motors was forced up the volume game.

Not that it was a point of concern. The small car, being for the mass market, was intended to be a high-volume product anyway.

In-house engine

With the body panels and structure frozen, the next challenge was the engine. Tata Motors was faced with a big challenge here because the engine had to be compliant with Euro III and Euro IV norms.

The company spoke to several designers and manufacturers of small engines ranging from Europe to Japan. But again they ran into the cost hurdle. No one could meet the price target that Tata Motors had in mind for the engine. After speaking to several others and examining options such as contract manufacturing, Tata Motors finally decided to work on the engine in-house. But why did they opt for a rear engine?

The answer is that it reduces the cost of the drive train. A front engine calls for an expensive universal joint and suspension. It costs less if the engine is in the rear. When you are looking to save Rs 500-700 on each component, every rupee matters and every design innovation assumes importance.

The compromise of a rear engine though is that the luggage compartment will be shifted to the front and again, it will not be as big as what it could have been had it been in the rear.