[Reader-list] The world’s cheapest car?

Thu Apr 9 18:18:47 IST 2009

Dear Siddharth

Personal Convenience Vehicles (Cars) and Public Transport Vehicles (Large Buses) are two distinctly different product categories in every which way including Technological Requirements, Economics, Purchase Decisions, Financing etc. Please don't mix up the two.

Large Buses belong to the Commercial Vehicles category unlike Passenger Cars.

Passenger Cars will roll off the Assembly Line of the Car Manufacturer and carry the marquee accordingly. Large Buses need not.

Bus Body Building is a connected but completely different operation from the Manufacture of the Drive Train Aggregates (Engine, Gear-Box, Axles) which go as essential components in the Bus. Bus Body Building is a specialised field in itself.

Globally, not very many manufacturer's of the Drive Train of Buses themselves have an In-House Bus Body Building operation. There is a lot of Job-Work required in building of Buses. It is labour intensive. Even with the same Drive Train there would be multiple versions of Buses depending on specific requirements.

Commercial Vehicle Manufacturer's therefore have on call the capacity of specialised Bus Body Builders for the manufacture of Buses to whom they would supply the Aggregates of the Drive Train or a complete Chassis Platform. This capacity could be captive capacity.

Both TATA and AL have such arrangements with Bus Body Builders even if the Buses might be finally sold as TATA or AL Buses. How and where do you think the TATA and AL Buses supplied this far were built? Certainly not in the TATA or AL factory.

In addition to this TATAs also have an In-House capacity for Bus Building.

It is therefore idiotic of Sunita Narain to whine that "Tata company, ......... does not possess the capacity to build the buses cities need."

It is not reasonable, is it, to project a quantum rise in the future demand of Buses in a scenario of ".....if more BRT corridors are to come up and the quantities that would be a requisite for a paradigm shift in urban transport were to be demanded" and then declare inadequate today's capacity to deliver Buses in the future. If there is a firm requirement in 'the future' the manufacturer's will accordingly increase their capacities for that future.

Just as an indicator, the Lead Time for delivery against any negotiated order for Buses could easily be 1 year or more.

The cost for expansion in capacity for Bus Building is minuscule when compared to a similar quantum expansion in the capacity for manufacture of Cars which requires substantially large capital investment in Plant & Machinery. To present it very simplified, primarily Additional Space, Additional Material and Additional Labour are required. The heaviest investment would be for a Paint Shop if the capacity of the current one is inadequate.

Globally, Large Buses are never sold Ex-Showroom (except in extremely small markets). Large Buses are sold against Firm Orders. So, I do not know what you mean by "not much incentive for the companies to develop such capacity". If there are Firm Orders, capacities will easily be developed.

In this connection you have also written "The possibility has been explored in the past,...". Would you please share what possibilities have been explored and with whom and on the basis of what.

Kshmendra

--- On Wed, 4/8/09, siddharth sareen <sidsareen at gmail.com> wrote:

From: siddharth sareen <sidsareen at gmail.com>
Subject: Re: [Reader-list] The world’s cheapest car?
To: kshmendra2005 at yahoo.com
Cc: "Rahul Asthana" <rahul_capri at yahoo.com>, "Sarai Reader List" <reader-list at sarai.net>
Date: Wednesday, April 8, 2009, 8:19 PM

Actually, that particular point is a fairly true reflection of the real state of affairs. Tata and Ashok Leyland are the two major private players in the country who have any capacity whatsoever to build buses, but their plant capacity is severely limited and nowhere near the kind of numbers we'd need, especially if more BRT corridors are to come up and the quantities that would be a requisite for a paradigm shift in urban transport were to be demanded. The possibility has been explored in the past, but there's not much incentive for the companies to develop such capacity, as compared to faster delivery of more cars.

Best

On Wed, Apr 8, 2009 at 8:06 PM, Kshmendra Kaul <kshmendra2005 at yahoo.com> wrote:

Dear Rahul

NANO or no NANO, for many on this List, Gujrat, TATA and India are all a NO-NO in which there cannot be any good aspects.

What has surprised me though is that someone like Sunita Narain (otherwise deserving of admiration) should say something as downright stupid and ill-informed as :

"""""" Think also that the same Tata company, that has managed to roll out the car of our dreams in record time, does not possess the capacity to build the buses cities need. """"""

In fact much of the tone and content of this piece by her makes me wonder whether she is going the "BLOWBACK" Arundhati Roy way of display of abject superficiality of intellect. That would be sad.  

Kshmendra

--- On Wed, 4/8/09, Rahul Asthana <rahul_capri at yahoo.com> wrote:

From: Rahul Asthana <rahul_capri at yahoo.com>

Subject: Re: [Reader-list] The world’s cheapest car?
To: "Sanjay Kak" <kaksanjay at gmail.com>, "Rakesh Iyer" <rakesh.rnbdj at gmail.com>

Cc: "Sarai Reader List" <reader-list at sarai.net>
Date: Wednesday, April 8, 2009, 7:14 PM

The writer doesn't take into account the intangibles accruing to
Gujarat,Tata and India from this project.

--- On Wed, 4/8/09, Rakesh Iyer <rakesh.rnbdj at gmail.com> wrote:

> From: Rakesh Iyer <rakesh.rnbdj at gmail.com>
> Subject: Re: [Reader-list] The world’s cheapest car?
> To: "Sanjay Kak" <kaksanjay at gmail.com>
> Cc: "Sarai Reader List" <reader-list at sarai.net>
> Date: Wednesday, April 8, 2009, 5:01 PM
> And instead of criticizing such subsidies, we have people
> who instead
> justify Modi's far-sightedness in bringing about
> industrial
> development to Gujarat. A very important article, and I
> feel not only
> this, but other kinds of data regarding pollution need to
> be brought
> in, so also the deteriorating effects these private
> vehicles are
> having on our health system.
>
> It would have been better had the Gujarat government had
> instead
> subsidized some public vehicle making plant, as that would
> have
> benefited all. Instead our governments are ready to do what
> the US
> govt generally does, bend down to the corporates. The day
> we all lose
> our money like this, probably doles would be given to
> people without
> guarantee to continue this capitalist system. And we will
> go down the
> drain sooner or later like the US has if we continue with
> this.
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-- 
Siddharth.