In an effort to boost sales of its US$2,900 Nano micro car, India's Tata extended the warranty and offered easier financing in December, while it also launched a new advertising campaign that included a TV spot.
It turns out that this was a smart move, as sales of the Nano spiked reaching 5,784 units, which represents a 1,136% increase over the 509 units the company shifted a month earlier. This is still below the 9,000 monthly sales record achieved in July, but it seems that the Nano is back with a vengeance for 2011.
The warranty has been extended to four years or 60,000 km (37,282 miles) and clients can opt for a US$2 monthly maintenance option, which, coupled with the opening of new sales points and the upcoming nationwide distribution plan, should keep the momentum going.
“Tata Motors is now focusing on the Nano because its reputation is riding on it”, said Umesh Karne, a Mumbai-based analyst with BRICS Securities Ltd., who has a “buy” rating on the stock. “Measures such as easy financing and the maintenance offer have reassured customers”.
Last but not least, the Indian maker also promised to retrofit all Nanos with revamped exhaust and electrical systems in order to prevent more cars bursting into flames.
By Csaba Daradics
Source: Bloomberg
