Cancellations by Tata Nano customers in India frustrated by the delay in delivery of the car are above 15% of total buyers, according to reports in the Indian press. But the frustration may be less the result of a logistics problem and more to do with customer perceptions given the more timely availability of competitor models.
India’s online consumer complaints forum, ConsumerComplaints.in, is currently listing grievances from customers disgruntled by the length of time they have had to wait between booking and delivery. While the Nano is the world's cheapest car, other low-cost models are available sooner, such as the Maruti Suzuki 800 and Hyundai Santro.
Customers on the site have also complained about paying interest rates between 10-12% per year on loans since June 2009 for vehicles they will not receive until March this year. Around 70% of Nano bookings were made through bank loans, according to India's Moneylife magazine.
Many are also incensed at the time it is taking to secure refunds on the down payments they have made.
According to Tata’s sole logistics service provider in the country, TCI, the delays in delivery are not to do with logistics and there is no problem with production with the Uttaranchal and Sanand plants, which are assembling the Nano on schedule.
TCI Supply Chain Solutions CEO, Jasjit Sethi, told Automotive Logistics News that “Tata has committed to complete the 100,000 deliveries by end of 2010 and that they are on schedule” with production actually higher than originally planned.
Tata did experience delays to production and delivery at the outset of its plans for Nano distribution in India when it was forced to pull out of production at its original plant in West Bengal following protests over land rights.
“The current deliveries are for the shortlisted customers… where Tata has committed that the price would be frozen,” said Sethi, adding that the car also commands a premium in the market and there is no reason for anyone to cancel their booking.
Tata is reported to have dismissed concerns, stating the cancellations were not unusual and that it will deliver 100,000 cars by the last quarter of 2010. It could not be reached for comment.
Last year Tata allocated the first 100,000 Nanos to customers from a lottery draw and Prem Verma, CEO of Tata Motors Limited Distribution Company, told Automotive Logistics News that the dispatches were running “as per schedule” and the company had “no major concerns” about bottlenecks or logistics challenges. “[Logistics] bottlenecks and challenges were budgeted for in the planning stages itself,” he said.
