January 8, 2008 / 6:51 AM / 13 years ago

Zeal, and worry, greet India's new "People's Car"

NEW DELHI (Reuters) - India’s “People’s Car” has yet to be unveiled and the advertising campaign has not even begun, but some Indians are already raving about Tata Motor’s new $2,500 car — despite the fears of environmentalists.

A family rides on a scooter during a monsoon shower in Agartala, Tripura, June 16, 2007. India's "People's Car" has yet to be unveiled and the advertising campaign has not even begun, but some Indians are already raving about Tata Motor's new $2,500 car -- despite the fears of environmentalists. REUTERS/Jayanta Dey/Files

“I am really excited and definitely buying the cheapest car in the world as soon as they launch it,” said Arindam Sapui, a rice trader in Burdwan, a small town in West Bengal.

This is exactly the kind of unbridled enthusiasm that environmentalists have been dreading as they predict a plague of ever-cheaper cars and ever-swelling clouds of climate-changing fumes.

Tata will unveil its 100,000 rupee car on Thursday.

Selling for less than half price of the current cheapest car in the market, it hopes it will tap into the growing ranks of India’s middle class — rather like the Volkswagen Beetle did in Germany or the Mini in England.

Sapui currently zips between villages for work on a scooter, and was thinking about upgrading to a more powerful motorbike.

“But my wife said the 1-lakh car would be cheaper and much safer,” he said, using the word for 100,000 in the Indian counting system.

Several more-established middle class consumers who already owned one car also said it would make for an affordable second car for a spouse, son or daughter.


But environmentalists may be relieved that some people interviewed in New Delhi and Mumbai were more muted.

Some echoed fears that car sales will rocket as more people become able to afford them. They were not thinking of gas emissions so much as the horror of the commute to the office in cities where roads are jammed and public transport is miserable.

“I don’t think the car should be launched at all,” said Kishan Aswani, 75, who commutes for an hour each weekday to his south Mumbai office.

“There is already a lot of traffic on the roads. Travelling by train is impossible, you simply cannot get in or move out.”

Tata Motors says a lot of these fears are unfounded. It says the car will meet emission standards and that car sales are already growing fast without the help of the People’s Car.

“Given the rate at which the entire industry will grow, even if we market it very heavily, it will still be a miniscule percentage of the cars entering the roads,” a company spokesman said.

He added that although the company is targeting first-time buyers, it was also expecting a large portion of sales to come from people trading in their old car as well as from people already considering buying a second-hand car.


Widespread poverty is another limiting factor.

For people like Anil, a 22-year-old rickshaw driver in Delhi, even the world’s cheapest car still seems ludicrously expensive.

“No money,” he said, rubbing his fingers and pouting. He earns almost exactly the national average income, and so the People’s Car amounts to more than three years’ earnings.

Likewise, Rakesh Kumar, a taxi driver, pointed out that only scooters and motorbikes could fit down the tight alleys that thread through the slums where he and tens of millions of other urban Indians live.

But as millions more people join the estimated 50 million strong middle class in the coming years, cars remain an important marker of status.

“It’s the same dream anywhere in the world,” said Jyoti Anand, a used-car salesman in Delhi. “You want a good home, a good car, and a beautiful wife.”

Baliram Thakur, a taxi driver, was also thinking of his wife when he said he planned to make a booking right away. Then someone told him the cheapest model came without air-conditioning, and his resolve wavered.

“No AC?” he said, taken aback. “The wife will get hot, and she won’t like that.”

Additional reporting by Bappa Majumdar in Kolkata and Swati Pandey in Mumbai

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