Tata Nano, the revolutionary car by Tata Motors, recently completed its first set of bookings for the first 100,000 nanos to roll out from the factories. The report from Economic Times about this booking is full of interesting points.

Tata Motors played a mastermove by issuing forms for Nano bookings. Moreover these forms were not given out through normal dealer channels, rather they were issued through all Tata Company outlets leading to savings in distrubution.

Tata Nano received Rs 2,500 crores through over 2.03 lakh bookings. This cash is extremely essential for Tata Motors and gives it liquidity without any burden. Tata Motors is offering around 8.5 – 8.75% interest to people who do not get the car in the first lot. The immediate result is that Tata Motors get around Rs 1,000-1,500 crores of financing from the people of India as just 8.5% interest per annum. Any loan from any other institution would have cost Tata Motors a lot more than this.

Moreover by providing easy financing through all major leading banks Tata Motors was able to get a great response. People could easily pay around Rs 3,000 and book a nano. The results depict this in a big way with over 70% of bookings being financed and rest through cash. Thus the financing option great enhanced the number of applications and helped the cause. Another suprising factor is that about 4,000 bookings were made online. This just goes to show that India still has a long way to go in the online revolution.

The top level of Tata Nano (Lx version) with a booking price of Rs 1.4 lakhs got the highest number of bookings with 50% of total bookings. The base version got just 20% of the bookings and the medium version got 30% bookings. This indicates that although Tata Nano was initially aimed at Rs 1 lakh car but people prefer the luxury version with better amenities.

Ofcourse this is just the first round of bookings for Tata Nano. Lets see how the next rounds happen and how Tata Nano fares in markets outside India. It will be interesting to see if the secondary market for Tata Nano starts once the allotment begins. If people will want to sell their Tata Nano at a premium and will people be willing to pay a premium for it.

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