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Tatas to make dream car in Uttaranchal

The company is looking at multiple locations for the production/assembling of the Rs 1 lakh car.

india Updated: May 01, 2006 15:19 IST

The Tatas have zeroed in on Pantnagar in Uttaranchal as one of the locations for production of their ambitious Rs one lakh car, which is the dream project of group chairman Ratan Tata, a senior government official has said.

The company, which has lined up over Rs 2,000 crore investments for the facility in the 1,100-acre site, is looking at multiple locations for the production/assembling of the car, production of which at Rs one lakh has been doubted by rivals, including Suzuki chief Osamu Suzuki.

"The Tatas' plan to have Pantnagar as one of the locations for their Rs one lakh car," official sources said. They, however, declined to give further details.

When contacted, a spokesman for Tata Motors refused comment on the matter. "Tata Motors works on a number of projects. We have no comment to make on any plant or any location," the spokesman said from Mumbai.

Pantnagar is an industrial cluster where two-wheeler major Bajaj Auto and utility vehicle major Mahindra and Mahindra are also setting up their plants. The state offers a ten-year excise duty holiday and five-year income tax exemption to those who start production before March 2007.

Besides evoking admiration for taking up the production of a Rs one lakh car, which the company hopes will sell as many as one million units annually.

However, undeterred by scepticism from industry rivals, Tata group chairman Ratan Tata has exuded confidence that a launch would be the only answer from him. The group, which is working on various sourcing routes for production of the car, has said it was looking at a 'gearless' vehicle, powered by a rear engine.

Tata said the proposed Rs one lakh car would be a vehicle that will seat four to five people and have a rear engine and will not be a scooter, three-wheeler or an auto-rickshaw made into a car. "It will also not be a stripped down car. It will be an inexpensive car," he said, but added that it would obviously not have the finish or the high speed or the power of a larger car.

The company has gone to Delphi for the engine management system for the car while on the styling front, it has taken help from Italian design house, IDEA, which worked with Tata Motors on its hatchback 'Indica'.

The sources said that apart from the Rs one lakh car, the Tatas will also use the Pantnagar location for production of its blockbuster light commercial vehicle 'Ace', which has been a runaway success in the market. "The Tatas plan to employ 8,000 people directly in the project while another 24,000 will be employed by the ancillaries," the sources said.

First Published: May 01, 2006 15:19 IST