Tata Motors seeks to retain Singur land for Nano expansion

Tata Motors has sought to retain the 997 acre land bank at Singur, which was allotted to the car maker by the erstwhile Left government of West Bengal. Tata Motors, which originally intended to build the Nano at Singur, shifted base to Gujarat on the back of violent protests by locals at Singur, who opposed the land acquisition. The Sanand facility, set up at Gujarat has been operating at less than one fifth of its installed production capacity of 250,000 Nanos/annum. 

Despite the low production, Tata Motors seems to have expansion plans for the Nano project, which is the reason being given by the car maker for the retention of the Singur land bank. The Nano's diesel variant, which will be introduced next year, is likely to boost volumes of the slow-selling hatchback. However, the increase in volumes might not be enough to warrant an additional production facility or expansion of the one at Singur. 

Therefore, Tata Motors might be keen on retaining the Singur land bank for purposes other than the production of the Nano. Tata Motors has plans of building a hatchback to sit between the Nano and the Indica. Dubbed project Dolphin, this project could be kickstarted at Singur if Tata Motors does not face any more violence/opposition from those opposed to the car maker's Singur factory. Tata Motors could also use the Singur facility for manufacturing other cars, the details of which currently are sketchy at best. 

Notably, the West Bengal government has been mired in a land tussle with another automaker, Hindustan Motors. Hindustan Motors' Uttarpara plant is prime real estate now and the automaker has been trying to redevelop/hive off chunks of this property, a move strongly opposed by the West Bengal government. Click here for Team-BHP's report on the Hindustan Motors BIFR filing, land sale and consequent implications.