Tata Motors’ independent director Nusli Wadia has said he had differences with Ratan Tata over continuation of Nano car which has proved to be a serious drain on the financial resources of the company.
In a letter to the shareholders of the auto major ahead of the extraordinary general meeting (EGM) on December 22, Wadia said the investment and losses on Nano have been in thousands of crores of rupees.
“The Nano, initially a car conceived to sell at Rs 1 lakh was launched in 2008 and has proved to be a serious drain on the financial resources of Tata Motors. Even at price Rs 2.25 lakh, the car neither sells nor is viable as every sale of the vehicle is at a substantial loss to the company,” he said.
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“After its commercial failure, which became evident not too long after its launch, I differed strongly with its continued operations and funding. Huge losses have been incurred over the years. The plan on which the investment was made was for 2.5 lakh cars while the production in 2015-16 was in the region of 20,000 cars and presently far less,” the letter said.
“The delay in closure if Nano is a serious drain on the finances of the company, in addition it has created very negative image on the passenger vehicles business of the company. The investment and losses on Nano have been in thousands of crore of rupees. Concerns have been raised not only by me but by several others regarding the continuing operations,” he said.
Wadia also said the “alleged reasons for seeking my removal do not even remotely relate to my performance or my conduct as an independent director of Tata Motors for 18 years.”