03 March, 2021

Small Car, Big Profits

Excess Indica bookings net Telco Rs 3,000 crore, but the big gains are in intangibles

Small Car, Big Profits

On January 23, the Tata Indica passenger car created history in more ways than one. In a mere seven days, Ratan Tata's prize product had attracted 1,15,238 individual bookings. That was a first. On January 24, Telco was sitting on more than Rs 3,000 crore. That, according to a financial analyst, was 'cash history'. Never before had Telco accumulated so much cash in the space of one week.

But the most decisive history was created by Telco itself. For the first time in India's corporate history, a company asked for complete faith - the full price of the car as booking amount for vehicles that could take anywhere between two months and two years to be delivered. And the trust was given. Says Rajiv Dube, Telco's general manager (commercial): 'The response is all the more encouraging as it comes in the midst of possibly the worst recession for the auto industry. More, just before our booking started, the competition slashed prices.'

True, even the Fiat Uno had managed to run up 2.9 lakh bookings. However, that was at only Rs 25,000 per car. Telco had also declared that the...

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