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Telco all set to roll out small car by Sept '98

The Tata Engineering and Locomotive Company's dream car in the small segment -- Indica -- is all set to hit the roads by September 1998.

Work on the prototypes and development of the diesel and petrol engines is progressing satisfactorily and the car will roll out in the 1998-99 fiscal year, company sources said on Sunday.

The entire model will be designed indigenously, the sources said. The 1300 cc petrol and diesel four-cyclinder engines have already been prepared and sent for optimisation to French consultants La Motor Modurene, one of the biggest engine producers in Europe. "We are seeking their opinion on the engine and their help in improving it," said the sources.

The body for the car, sources said, is being designed by one of the world's top car designer firms -- Idea of Italy. All the components for the vehicle are being designed inhouse. "The body styling and engine design of the vehicle are through; now, we are conducting the test drives," they said.

The car, with which the company expects to end the monopoly of Maruti Udyog Limited in the small car segment, will be priced at around Rs 250,000. "We are aiming at a car which would be greater in performance than the Maruti 800 cc and lower in price than the Zen." they stated.

With this Rs 17 billion project, Telco expects to cover the entire strata of the automobile sector, from heavy vehicles to medium-sized ones to utility vehicles, jeeps and small cars.

The company has targetted a sale of 50,000 units in the first year.

It may be recalled that Telco chairman Ratan Tata had stated at the company's annual general meeting in Bombay recently that facilities for a high volume production of the car are rapidly coming up at Chikhali, adjacent to the company's plant at Pimpri, near Pune.

The factory building, together with supporting infrastructure and plant facilities are in the final stages of completion: orders for a majority of the imported as well as indigenous and inhouse manufactured plant and machinery have been placed and deliveries for these are being monitored closely to ensure timely launch of the car, he said at the meeting.

Besides, distribution networks, dealerships, and after sales service facilities are also being developed and are expected to be ready well in time for the introduction, Tata stated.

The plant would, initially, have a production capacity of 150,000 units per annum, which would later be expanded as per demand.

The small car venture, sources said, is currently the highest priority project with the company and furious activity is on to give shape to the project, he said.

The passengers car segment in the country has undergone a dramatic change. Over 370,000 passenger cars were sold in India during 1996, an increase of 16 per cent over the previous year. The demand is expected to be between 600,000 to 1 million by the turn of the century, with a major share being in the low-priced segment.

The automobile industry is already becoming an extremely competitive business area and will become more so as the new capacities presently under construction get commissioned.

The consumer will have an ever increasing choice of products and decisions about purchases will be totally discretionary, based on visual appeal, price, quality, reliability, and after sales support. This will undoubtedly demand an upgradation of the capabilities of the existing manufacturers and their reorientation towards being more competitive and market driven. The component manufacturers will also need to upgrade their technology and processes to remain competitive, Tata stated.

The growth in the automobile segment will further stress the woefully inadequate supporting infrastructure like roads and the highway networks. The tremendous increase in motor vehicles will also bring greater pressure on the enforcement of air pollution and vehicle emission standards.

The automobile manufacturers must recognise their responsibility in controlling emission levels in their vehicles and must actively support as well as comply with the new emission norms being legislated, he added.

UNI