The company, however, said it has not yet frozen a timeline for the launch of the diesel option of the Nano although it is ready with the vehicle.
"The Nano sales have gone down and we are working to get it back. It still has a long way to go but we will be introducing the 2013 model of the car in the first half of this year as part of the plan," Tata Motors Managing Director Karl Slym told PTI.
The new Nano will have a lot more additional features, which would enhance the positioning of the car as an aspirational vehicle, he added.
"Moreover, we will very soon introduce the CNG option of the Nano," he added.
When asked about the diesel variant of the entry level car, Slym said: "In future, we will definitely introduce that but we have not fixed a date as yet. The vehicle is there though."
The Nano has struggled to pick up sales in a tough market. In January this year, its sales declined by over five-fold to just 1,504 units as compared to 7,723 units in the same month last year.
In the April-January period this fiscal, Nano sales stood at 50,836 units as against 54,835 units in the comparable period last year, down by 7.29 per cent.
Former chairman of the Tata Group, Ratan Tata, who was the driving force behind the Nano, had admitted that the small car had missed initial opportunities.
"We were not prepared to market the car as we should have. I think that has a lot to do with the fact that momentum got lost," he told PTI in an interview last year.
Tata had also listed out the reasons due to which Nano, nick-named 'The people's car', could not realise its full potential as the momentum got lost in initial years due to issues like plant transfer and insufficient advertising campaign and dealership network.
He had said the issues are being addressed, and the Nano was being 'refreshed' to realise its full potential.