India’s largest automobile company, Tata Motors, said that it is producing its small wonder Nano at less than half of the annual installed capacity of 2.5 lakh units at Sanand, Gujarat due to lower demand. The company recently launched its first upgrade of Nano to boost its sales which suffered heavily after too many reports of catching fire.

“Our installed capacity for Nano is 2.5 lakh units per annum and we are presently producing 10,000 cars per month,” R Ramakrishnan, VP (commercial), passenger car business head of Tata Motors Ltd, said.

Tata Motors have invested a lot in making the cheapest car of the world in the name of Nano and wants to now increase its reach to all parts of the country especially the rural area. Ramakrishnan further added that the company has planned out to open exclusive Nano outlets in these areas for better reach and the target segment will be two-wheeler buyers.

The Nano is not the only car suffering from lack of demand. Most carmakers are hit due to the slowdown in the auto industry. Sales have dropped this year due to high interest rates, rising fuel prices and double digit inflation. The majority of the manufacturers have cut their production to align inventory with demand.

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