SUMMARY

TATA NANO was india’s cheapest car with not the most affordable or the best value for the money.
Ratan tata was the chairman of Tata sons has a vision to make a new project to make the small car
with the cost $2500.

The basic model of Nano didn’t have stereo, air conditioner , power windows , love compartment,
no airbags, antilock brakes, no power steering, no remote locking and also made the body of car
from biodegradable plastic to keep it lightweight and reduce the cost and had two cylinders instead
of 4. This new small car was targeted to the low income people, who ride on two wheeler and the
family who just wanted to have their own first car.

But unfortunately as the TATA Motors did nothing to make loans easily available tp its target
customers i.e two wheeler , They couldn’t afford to pay the Nano’s price outright. Only in 2011 the
financing was easier because finally TATA Motors did partnership with other 29 Banks and Non-
banking companies. Tata also announced to financing to its potential customers by giving loans but
with a higher interest rate.

TATA Motors failed to establish distribution channels where its target customers lived in semi-urban
and rural areas of india, there was no show room for the place where a actual potential exist. But
after doing some analysis in january 2011 they got an innovative idea to collaborate with Big Bazaar
in tier-2 and tier-3 cities. So because of that in December 2012, sales had grown by 18%.

The communication strategy of Tata Motors, got a free coverage that the media gave to the Nano,
resulted in publicity worth more than $80 million, and also It came on a national news and received
attention globally as well and was said to be the world’s cheapest car. Nevertheless, because it was
free, the media focused not only on good news but bad news as well. As a consequence of
unprecedented hype in media, technical problems with the Nano were more highlighted and quickly
exposed to the world. So the Singur plant controversy and the main Fire incidents were viral on the
internet.

There was also a lack of communication with the public by tata motors. Instead of recalling the cars
after the problem of catching fires , they de-empasize the situation as smoke incidents and merely
changed its supplier.

Many people associated with the nano in 2009 genuinely believed that because of existing hype
Nano did not require advertising, since the nano was about innovation, tata motors intentionally
decided to use unconventional advertising by using google, yahoo, and others were booked by tata
motors for pop-up ads.

Even the Bill Gates had commented on the unexpected performance of the nano and relate it with
other same kind of car “Edsel”

Although in may 2015 Tata motors tried to reposition the Nano by launching onother version which
is “GenX Nano”. But The future of the tata nano would began to appeal to a different market
segment, which was commercial taxi.