Tata Hopes to Shift Ultra-Low-Cost Nano Upmarket

Tata Motors Ltd. hopes a redesign, new features and a higher price will help revive sales of its $2,000 Nano minicar, The Wall Street Journal reports.

When Tata introduced the Nano in 2009, it implemented a lottery to distribute the first 100,000 units and predicted annual sales as high as 1 million vehicles.

But monthly sales peaked at an annual rate of about 120,000 units early last year and are running at only 25% of that pace now, according to the Journal. It says Tata misjudged the market by focusing solely on low price, prompting many first-time car buyers to shun the Nano for costlier but better-equipped cars from rival manufacturers.

Tata is responding by adding such features as glove compartments, a second windshield wiper, air conditioning, fancier wheel covers, chrome trim and a four-speaker audio system. The new top-end Nano LX will retail for about $3,600.

The Journal says Tata hopes to bolster sales among young buyers by touting the revamped Nano a "cool people's car" in television ads that urge viewers to "celebrate awesomeness."