Parts makers stretched as Nano output gathers pace

As commercial production of at Tata Nano picks up at both its mother plant at Sanand in Gujarat, where it started earlier this week, as well as its original production unit at Pantnagar, Uttarakhand, vendors supplying components are feeling stressed about supplying parts to both locations.

The company is operating on a single shift of eight hours and produces nearly 150 Nanos a day, or 4,500 a month, at Sanand, and its Pantnagar plant has a similar production schedule. Tata Motors plans to raise production to 1,200 a day at Sanand by December, which is set to mount further the pressure on automobile parts suppliers.

Sanand has an installed capacity of 250,000 cars annually, to be expanded to 350,000 and eventually, depending on demand, to be scaled up to 500,000 cars annually (at 1,000-1,200 cars a day, the plant is likely to touch around 350,000 cars a year by March 2011, considering 295 working days in a year).

With auto parts suppliers already stretched in trying to meet a more than 25 per cent rise in car sales since April, the development is certain to add to their worries. A few car manufacturers had to import critical parts such as batteries, tyres, windscreens, glass-packs and wheel rims from South-East Asian countries, after supplies fell short.

A leading vendor, supplying at least six crucial components of the car, told Business Standard on condition of anonymity, ''Currently, we are supplying to feed a production of around 200 cars per day in Pantnagar and also to meet demand in Sanand. As of now, the car will continue to be produced at both the sites to ensure faster deliveries. But continuing to feed a low volume assembly line at Pantnagar would become difficult in the long run, owing to logistical issues.''

The company aims to complete deliveries by December of cars booked in the first lot, so that it can take fresh bookings. When asked if production at Pantnagar would continue after the first lot of bookings had been cleared, a Tata Motors spokesperson said, ''A decision on that is pending.''