Tata Motors Ltd on Tuesday launched the Compressed Natural Gas (CNG) version of its small car Nano and said that the gas-run versions of Indica and Indigo models would follow soon.

This is the first-ever gas-run product launched by Tata Motors, and its delivery will begin on October 9.

The company, which has four manufacturing facilities in India, has not ruled out manufacturing Tata Motors’ brands and models other than Nano at Sanand, a senior official said.

The new bi-fuel product, ‘Tata Nano CNG emax’, that can run on gasoline as well as CNG, will cost Rs 2.45 lakh for Nano CX and Rs 2.72 lakh for Nano LX, ex-showroom Ahmedabad, which Ankush Arora, Senior Vice-President and Head-Strategy, described as the ‘Nano City’.

Arora said that the price difference between the petrol and CNG versions of Nano is about Rs 44,000. The new product is expected to attract customers in states like Gujarat, NCR, Maharashtra and Tripura, where CNG is available. Of all cars sold in India, 15 per cent are gas-run.

Nano CNG, showcased in Pune in June and commercially launched here on Tuesday, comes with a four-year warranty or 60,000 km, whichever is earlier. “It comes with factory-fitted fire extinguisher as per rules.”

Replying to questions, Arora admitted that the Sanand plant of Tata Motors, having an annual capacity to manufacture 2.5 lakh cars, is currently utilising only 10 per cent of its capacity, in one shift, and producing 2,000 cars per month, mainly due to grim market conditions.

In 2012-13, the company manufactured 55,000 cars. In the first half of the current fiscal, it sold 18,000 Nano cars. “We stock cars only for a month.”

He said that the company’s policy of selling Nano directly to credit card users will continue in the ongoing festive season which has seen a 15 per cent growth over last year’s corresponding period.

Tata Motors exports about 200 Nano cars per month to Sri Lanka and Nepal, but no CNG cars will be exported for now.

For now, Tata Motors is focusing on rural areas and its pilot projects are running in a couple of states, he said, adding that nearly 600 campaigners have fanned out to villages with a minimum population of 50,000 to popularise the products. “We are also appointing more dealers in rural areas.”

At nearly Rs 66 per kg, CNG is, perhaps, the costliest in Gujarat. Nano CNG cars, having a 32-litre CNG capacity and a 15-litre gasoline tank capacity, can run up to 375 km on full tank at a speed of 36 km per kg. Its running cost will be Rs 1.32 lakh at the current price levels.

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