ANALYSIS ON THE TATA NANO PROJECT

BY- SUBMITTED

SYED SAMI UDDIN TO

MBA-MARKETING $ SALES

2ND SEMESTER DR.ALPANA SRIVASTAVA

 Company profile
TATA MOTORS

Established in 1945, when the company began manufacturing locomotives, the company

manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG,

which ended in 1969.[4] Tata Motors is a dual-listed company traded on both the Bombay Stock

Exchange, as well as on the New York Stock Exchange. Tata Motors in 2005, was ranked among

the top 10 corporations in India with an annual revenue exceeding INR 320 billion. In 2010, Tata

Motors surpassed Reliance to win the coveted title of 'India's most valuable brand' in a survey

conducted by Brand Finance and The Economic Times.

Tata Motors has auto manufacturing and assembly plants

in Jamshedpur, Pantnagar, Lucknow, Ahmedabad, Sanand,Dharwad and Pune in India, as well as in

Argentina, South Africa and Thailand.

LOGO OF TATA MOTORS

 TATA NANO

The cheapest car in the world today, though the price continues to rise due to increasing material costs,it

is an exemplary example of Gandhian engineering, a concept involving deep frugality and a willingness

to challenge conventional wisdom.

The car was the result of a five year research and development project carried out by Tata Nano

development team. While developing the car, Tata Motors and its suppliers constantly made efforts to

reduce the costs while ensuring quality of each and every component including engine, steering, wheels,

tires, windshield washing system, gear shifter etc.

Tata nano was more than just a car for the tata group . the chairman of the group RATAN TATA was

closely associated with the project it was his visionary and guidance that lead to the development of Tata

Nano for the visionary Tata Nano was something he wanted to give this nation.
He wanted that the common Indian can be able to access the dream of owning a car and move along with

his family. With such a great tempo and enthusiasm to perform Ratan Tata started the Nano project

however the official announcement came on March 2003 when  Ratan Tata disclosed plans to launch the

world’s cheapest car at Rs 1 lakh at Geneva Motor show.

The Nano project gave Tata the much hype across the global market and the automobile industry

started speculations but Tata motors kept going under the guidance of Ratan Tata, buts as it is said

tomorrow is unpredictable the same happened with the Tata group, SINGUR controversy in West

Bengal broke out. when company was expecting to the roll the car as soon as possible on road the

controversy made Tata to suffer a lot. After rolled it out it was recognized as ‘the people’s car’.

NANO SPECIFICATION

The Tata Nano is BS-3 compliant and is also available in the BS 2 variants. The Indian variants are

more or less like the European norms such as Euro 2, Euro 3 and the Euro 4 norms. The fuel

efficiency or the mileage stands at about 23.6 km per litre and this has been certified by the

Automotive Research Association of India. The car will come in three variants. That is the standard

variant, the CX variant and the LX variant. The specifications as well as the features of the car have

been provided below it has a Top speed of 105kmph.

Dimensions and Body:

 Length: 3.1m

 Height: 1.6 m

 Width: 1.5 m

 Seat belt: 4

 Trunk capacity: 15 L (0.53 cu ft

 Ground clearance: 180 mm (7.1 in)

 12-inch wheels

Engine specifications for Tata Nano:

 Rear-wheel drive

 2-cylinder, 624 cc

 33 bhp

 Compression ratio: 9.5:1

 Multi point fuel injection petrol engine.

 Engine is rear mounted.

 Power: 33 PS (33 hp/24 kW) @ 5500 rpm

 Torque: 48 N·m (35 ft-lb) @ 2500 rpm

 1st time a 2-cylinder gasoline engine was being used in a car with single balancer shaft.

 Anti-vibe balancer shaft

Safety features

 Sheet metal body

 Crumple zones

 Intrusion resistant doors

 Seat belts

 Strong seats and anchorages

 Rear tailgate glass bonded to the body.

 Tubeless Tyres

Performance

 Acceleration: 0-70 km/h (43 mph): 14 seconds

 Maximum speed: 120 km/h (75 mph)

 Turning radius: 4 metres

 Fuel efficiency (overall): 20 kilometres per litre (5 litres per 100 kilometres

Body and dimension

THE PROJECT TIMELINE

March 2003- Ratan Tata discloses plans to launch the world’s cheapest car at Rs 1 lakh at

Geneva Motor Show.

May 2006- Tata Motors announces setting up Nano manufacturing unit at Singur in West Bengal

with initial investment of Rs 1000 crore spread over 700 acres; scaled up to 1,000 acres with

total investment of Rs 1,500 crore.

Oct 2006- Trinamool Congress opposes Tata Motors’ plans to set up factory at Singur, calls 12-

hour statewide bandh alleging forcible acquisition of farmers land.

Dec 2006- Violence mars Singur, five hurt in rubber- bullet firing. Mamata Banerjee goes on

indefinite hunger strike, which was called off after 25 days following appeals from the Prime

Minister and the President.

Jan 2007- Land puja offered at Singur car project site

Feb 2007- Police-mob clash at Singur.

Mar 2007- WBIDC signs a 90-year agreement with Tata Motors for Nano plant; farmer commits

suicide; mob attacks proposed site; bomb explosion damages fencing

May 2007-: Peace talks between state government and Trinamool Congress fail; one more

farmer commits suicide

June 2007- CPI(M) patriarch Jyoti Basu echoes Mamata Banerjee’s demand that only 600 acres

is required for the Singur project instead of 1,000 acres, but state government rules out returning

Singur project land to farmers

Nov 2007: Central forces deployed at Singur after fresh protests

Jan 2008- rattan Tata unveils Tata Nano at auto expo at New Delhi. Calcutta high court declares

acquisition of land [singur] illegal

March 2008 – Tata motors showcase nano at Geneva motor show.

May 2008- Supreme Court refuses to stay nano roll-out from singur

June 2008- protesters break factory gate

Aug 2008- talks between west Bengal chief minister and Mamta Banerjee , while Tata threatens

to exit West Bengal. Dharna by Trimool congress, workers stay away from work.

Sep2008- West Bengal governor interferes .agreement between state government and trinamool

congress but it is short-lived. Mamta Banerjee holds rally demanding return of 300 acre land

security guards at Tata plant attacked.

Oct 2008- rattan Tata finally announces to pull out and with in days announces sanand at Gujrat

as its new manufacturing plant with an investment of 2000crs.

Feb 2009- Ratan Tata announces the launch of Nano on 23rd march

March 2009- Ratan Tata unveils the European version of Nano with euro 5 norms.

March 2009- Tata Nano is launched in India.

THE ANALYSIS

On April 25, 2009, bookings closed for the much-awaited Tata Nano, the world's cheapest car,

made by India-based Tata Motors Limited (Tata Motors). The bookings began on April 09, 2009

and the car received an overwhelming response from the Indian consumers. The company

received a total of 203,000 bookings for the car.

Tata Motors, the largest automobile company in India in terms of revenues, launched Nano,

commercially on March 30, 2009 (Refer to Exhibit I for a visual on Nano). The car with an ex-

factory price tag of Rs.100,000 generated enormous interest among the public as well as industry

experts. It came to be known as the ‘PEOPLE’S CAR’ initially it gained heights of popularity

and created the much needed hype that was required .it began to be looked up as the next big

thing in the Indian market, according to Ratan Tata the “people’s car” of today primarily has to

be for first-time buyers with average incomes way below those of industrialized Western

countries. Ratan Tata’s brief for the Nano was that, apart from being cheap to buy, it must be a

“proper” car that exceeds Indian safety and emissions requirements and must be economical to

run. One look at the Indian market told the Tata engineers that the cost objectives could not be

met by stripping out an existing conventional car. The cheapest car on the Indian market, the

Maruti 800, was based on an age-old Suzuki minicar and costs twice as much as the Nano.
So, appropriately, Tata went back to the basics. Every component and every system was

analyzed to find the cheapest solution that would achieve the required function, strength, and

ease of production. Nothing was taken from an existing Tata model. Nothing superfluous would

be included. To achieve the required cabin space within a small footprint, the design became a

tall monobox with a sloping front. The 0.6-liter two-cylinder engine and four-speed manual

transmission are tucked away under and behind the rear seat, installed transversely in a drop-

down cradle that includes the final drive, cooling and exhaust systems, and rear suspension. The

car’s structure is a welded steel monocoque with stamped steel outer panels, which turned out to

be more cost effective than plastic.

Tata Nano was on a clutch of innovative marketing ideas when it rolled into showrooms across

the country. The Rs 1 lakh car, which broke new ground in design, engineering and production

processes, opted for "cost-effective and innovative use of media," say people with knowledge of

the Nano marketing strategy.

To make the car more easily accessible to people, the Tata Motors team sold the Nano not just

through Tata car dealerships across the country, but also through conventional retail outlets like

Westside and Croma.

Westside is a lifestyle retail brand and Croma is an electronic megastore. Both are owned by the

Tata group. Westside and Croma outlets displayed Nano and also take bookings. Also a whole

range of Nano merchandise like baseball caps, T-shirts and key chains, among others were made

available.
Carrying forward its vendor partnership production strategy, Tata Motors had shared promotion

of the Nano brand with its multiple PSU bank partners. These PSU financiers are promoting the

Nano brand during booking jointly with Tata Motors and on their own.

But something went wrong with Nano since its inception the glamour and prestige that Nano

brought soon got into deep waters with cars poor performance as the car sold people realized that

a too light weighted and incomplete car was not an alternative to a regular car. Too light

weighted in the sense that the stability and driving dynamics became a problem with the car

since it was more suited for city people who though to buy as a second alternative besides a

regular car dropped the idea and soon the trouble started, as time passed people’s interest was

lost though the reviews of the car magazines came good and Tata gained lots of laurels for

making the world’s most cheapest.

Still the negative impact wasn’t so when people across India started booking more cars the news

of fire broke out and that was the time when really Tata Nano project got a big blow.
After it everything was an impact of what car has actually done reports were published in news

papers, news channels reported the matter and Nano was in controversies again. Further booking

got a big blow.

THE WORLD'S CHEAPEST FOUR-SEATER CAR, THE TATA NANO, ROLLED OUT

BY TATA MOTORS, failed to deliver with middle-class Indians eager to buy an

'affordable car', following safety problems.

Sales dipped by an alarming 85 per cent, to 509 units Nano’s last month, compared same month

of November in 2009 after at least six of them caught fire, the last one in New Delhi in August.

This was the fourth straight month of falling sales from the high of 9,000 cars in July.

Dramatic footage of fires on TV news channels had a negative impact on the sale of the two-

cylinder, 600cc Nano.

 FURTHUR FOLLOWING ARE THE MAJOR REASONS FOR

THE FAILURE OF TATA NANO

1. the heat and sound caused by its engine, which is mounted rear below the seats.

2. long waiting list.

3. interior of the car giving impression of make shift design.

4. fixed tailgate making access to engine difficult.

5. less than 30km/l average.

6. inadequate luggage room.

7. no gloves compartment.

8. front nose of the car giving impression of 'suparnka’

hence according to me TATA NANO HAS FAILED.