MINI PROJECT-I REPORT (KMBN 152)

ON

“Why TATA Nano Failed in Indian Market”

A Project Report Submitted In Partial Fulfillment of the Requirement

For the Award of Degree of MASTER OF BUSINESS ADMINISTRATION

UNDER THE GUIDANCE OF:

Miss Usas Singh (Asst. Prof.)

Submitted By:

STUDENT NAME- GAURAV RATHORE

MBA - I Semester

ROLL NO: 2302030700041

SESSION: 2023-2025

RAMESHWARAM INSTITUTE OF TECHNOLOGY AND

MANAGEMENT
(Affiliated To DR. A.P.J. Abdul Kalam Technical University, Lucknow)
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 Acknowledgement
I take this opportunity to express our sincere gratitude to all those who helped us in various

capacities in undertaking this report and devising the report.

I am privileged to express my sense of gratitude to my respected Assistant professor Miss

Usas Singh Ma’am whose unparalleled knowledge, moral fiber and judgment along with

her know-how, was an immense support in completing the report.

I shall be indebted to Miss Usas Singh Ma’am (Head of Management Department) for the

concern in providing necessary information during making of this Mini Project Report.

I feel pleasure and pride of being part of management studies, Rameshwaram Institue of

Technology and Management, Lucknow that moulded me to this present state and I feel

gratitude towards.

I take this opportunity also to thank my friends and contemporaries for their co-operation

and compliance.

Gaurav Rathore

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 Declaration
I certified that this report is prepared based on the project undertaken by me in ‘Why

TATA NAno failed in Indian Market’ under the guidance of assistant professor in partial

fulfillment of the requirement for the award of degree of Master’s of Business

Administration from Rameshwaram Institute of Technology and Management.. The

work submitted by me in partial fulfillment of the requirement for the award of degree in

this report is of my own, it has not previously been presented for another assessment. I

declare that this report is my original work. Wherever work from other sources has been

used, all debts (for words data, argument, and ideas) have been appropriately acknowledged

and referenced in accordance with the requirements of regulations and guidelines.

Student’s Sign:

Date:

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 Preface

For a Management student, Mini Project plays an important role during the study. This
project provides a corporate or real-world platform to learn practically. MBA degree
without any Innovative Project or ideas, experience is just like food without salt. So, Mini
Project provides a great learning experience about management concepts and its
applications.

This project was undertaken as a part of the curriculum of MBA course, which is
compulsory for each student to have the project in any new ideas to the development of the
student capabilities and gain the knowledge. This exposure enables the mentor to learn
effective and efficient ways and means to solve the real problems faced by the organization
and also to understand its dynamics

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 Table of Contents

Serial No. Content Pages

1 Acknowledgement 2

2 Declaration 3

3 Preface 4

4 Introduction of the company 6-9

5 History of the company 10-12

6 Introduction of the product 13-19

7 Objective of the project 20

8 Literature review 21-22

9 Research Methodology 23-27

10 Competitor analysis 28-31

11 Advantages of the product 32

12 Disadvantages of the product 33

13 Limitation of the study/ Research 34-35

14 Suggestions 36-37

15 Conclusion 38

16 Reference 39

17 Annexure 40-43

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 Introduction of the company
The Tata Group is a multinational conglomerate headquartered in Mumbai, India. It is
India's largest conglomerate, with products and services in
over 150 countries, and operations in 100 countries across
six continents.

The group operates in more than 100 countries across six

continents, with a mission 'To improve the quality of life of
the communities we serve globally, through long-term
stakeholder value creation based on Leadership with Trust'.
Tata Sons is the principal investment holding company and
promoter of Tata companies.

Founded in 1868 by Jamsetji Tata, the Tata Group is now a global giant with a wide
range of businesses, including:

Information Technology: Tata Consultancy Services (TCS) is one of the largest IT

services companies in the world, and other group companies like Tata Elxsi and Tata
Communications are also leading players in the IT sector.

Automobiles: Tata Motors is India's largest automobile manufacturer, and owns iconic
brands like Jaguar Land Rover.

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Steel: Tata Steel is India's largest steel producer, and one of the leading steel companies in
the world.

Consumer Goods: Tata Consumer Products is one of India's largest FMCG companies,
with brands like Tata Tea, Tetley, and Salt.

Energy: Tata Power is India's largest integrated power company, and also has a presence in
renewable energy.

Aviation: The Tata Group recently acquired Air India, making it a major player in the
Indian aviation industry.

Other businesses: The Tata Group also has businesses in a wide range of other sectors,
including hospitality, education, healthcare, and financial services.
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The Tata Group is known for its commitment to ethical business practices and its social
responsibility initiatives. The group has a strong philanthropic tradition, and its Tata Trusts
are one of the largest philanthropic organizations in India.

Here are some key facts about the Tata Group:

Founded: 1868

Headquarters: Mumbai, India

Chairman: N. Chandrasekaran

Revenue: \$150 billion (INR 12 trillion) (2022-23)

Employees: Over 1 million

Businesses: Over 30 companies in 10 verticals

In 2022-23, the revenue of Tata companies, taken together, was $150 billion (INR 12
trillion). These companies collectively employ over 1 million people.

Each Tata company or enterprise operates independently under the guidance and
supervision of its own board of directors. There are 29 publicly listed Tata enterprises with
a combined market capitalisation of $300 billion (INR 24 trillion) as on July 31, 2023.

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 Chairman
The chairman of Tata Sons is usually the chairman of the Tata Group. As of 2020, there
have been seven chairmen of Tata Group.

 Jamsetji Tata (1868–1904)

 Sir Dorabji Tata (1904–1932)

 Sir Nowroji Saklatwala (1932–1938)

 J. R. D. Tata (1938–1991)

 Ratan Tata (1991–2012)

 Cyrus Mistry (2012–2016)

 Ratan Tata (2016–2017)

 Natarajan Chandrasekaran (2017–present)

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 History of the company
A Detailed History of the Tata Group: From Trading Firm to Global Conglomerate

The Tata Group's journey spans over 150 years, intricately woven with India's own story of

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growth and transformation. Here's a detailed look at its historical milestones:

Early Foundations (1868-1904):

1868: Jamsetji Nusserwanji Tata, a visionary entrepreneur, establishes a trading firm in

Bombay (now Mumbai). He lays the foundation for ethical business practices and social
responsibility, values still ingrained in the group today.

1892: The company enters the textile industry, acquiring a mill in Nagpur.

1902: Indian Hotels Company is incorporated, opening the iconic Taj Mahal Palace &
Tower in 1903: symbolizing luxury hospitality in India.

1904: Jamsetji Tata passes away, leaving behind a legacy of business acumen and
philanthropy.

Diversification and Expansion (1904-1938):

1907: Sir Dorabji Tata, Jamsetji's son, establishes Tata Iron and Steel Company (TISCO),
later known as Tata Steel, laying the groundwork for India's industrial development.

1910: Tata Power commences operations, bringing electricity to Bombay.

1911: The Indian Institute of Science is established in Bangalore, showcasing the group's
commitment to education and research.

1917: Tata Consumer Products enters the consumer goods market with soaps and
detergents.

1932: Tata Airlines, later known as Air India, takes flight, marking the group's foray into
aviation.

Leadership and Growth (1938-1991):

1938: Jehangir Ratanji Dadabhoy Tata (J.R.D.) takes over as Chairman, leading the group
through a period of rapid expansion and technological advancements.

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1939: Tata Chemicals is established, diversifying into the chemical industry.

1945: Tata Engineering and Locomotive Company (TELCO), later renamed Tata Motors, is
founded, marking India's entry into automobile manufacturing.

1952: Lakmé, a leading cosmetics brand, is launched.

1954: Tata enters the engineering and manufacturing sector with Tata Industries.

1962: Tata Tea is acquired, strengthening the group's presence in the FMCG sector.

1968: Tata Consultancy Services (TCS), India's first software services company, is
established, paving the way for the IT revolution in India.

Modern Transformation (1991-Present):

1991: Ratan Tata becomes Chairman, ushering in an era of global acquisitions and strategic
partnerships.

1998: India's first indigenous car, the Indica, is launched by Tata Motors.

2000: Tata acquires Tetley, expanding its tea business abroad.

2005: Jaguar and Land Rover are acquired, placing Tata Motors on the global automotive
map.

2007: Corus Group, a leading European steelmaker, is acquired, making Tata Steel a global
leader in the steel industry.

2018: Air India is acquired by the government, marking the group's exit from airlines after
86 years.

2022: Tata acquires BigBasket, an online grocery platform, entering the e-commerce sector.

Today:

The Tata Group remains a diversified conglomerate, spanning industries like IT, steel,
automobiles, consumer goods, hospitality, and more. It continues to play a significant role
in India's economic growth and development, while upholding its principles of ethics and
social responsibility.

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 Introduction of the product

Tata Motors Limited is a leading global automobile manufacturer of cars, utility vehicles,
buses, trucks and defence vehicles. As India's largest automobile company and part of the
USD 100 billion Tata group, Tata Motors has operations in the UK, South Korea, Thailand,
South Africa, and Indonesia through a strong global network of 76 subsidiary and associate
companies, including Jaguar Land Rover in the UK and Tata Daewoo in South Korea. In
India, Tata Motors is a market leader in commercial vehicles and among the top passenger
vehicles manufacturers with 9 million vehicles on Indian roads. With design and R&D centres
located in India, the UK, Italy and Korea, Tata Motors strives to pioneer new products that
fire the imagination of GenNext customers. Abroad, Tata cars, buses, and trucks are being
marketed in Europe, Africa, the Middle East, South Asia, South East Asia, South America,
Australia, CIS and Russia.

As part of the Tata Group, Tata Motors has been a strong part of the Indian history. With
many successful launches of both commercial and passenger vehicles such as Tata 407s, Tata
Sumo and Tata Indica, Tata Motors finally decided to launch a passenger vehicle that will set
a new trend of “Easily Affordable” passenger vehicle – The Nano. We try to view this
amazing story from a lateral point of view and understand what went wrong and what could
have been done to this amazing car.

Tata Nano was launched in India, targeting the families who use bikes as a form of travel. It
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was designed to allow the families to have a more comfortable, safe means of travel. Price
was also a factor in the development of the car and it was supposed to be the most affordable
car in the world. It was supposed to have a price tag of one Lakh Rupees.

The Making of Tata Nano Tata Motors had a formidable challenge at their hands of making a
car that costed only one lakh but had all the necessary and essential features.

This was reflected in the making of the Nano. All the non functional parts were eliminated,
the essential parts were redesigned to reduce cost like the spark plugs, engine etc.
Bosch engineered the spark plugs based on motorcycle spark plugs.

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Company International Competition & Analysis

Below are the top 3 Tata Nano competitors:

1. Maruti Alto
2. Hyundai i10
3. Maruti 800

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The Tata Nano is a discontinued city car/microcar made and produced by Indian automaker Tata
Motors over a single generation, primarily in India, as an inexpensive rear-engined hatchback intended
to appeal to current riders of motorcycles and scooters — with a launch price of ₹100,000 (US$1,300 )
on 10 January 2008.

Price Engine Space & Features Target Safety Market Strengths Weaknesses
Comfort Segment Rating Share
(Peak)
₹1 624cc, Limited Basic Entry- No 5.4% Extremely Safety concerns,
Lakh Petrol space, 4- level rating (2010) affordable, Perceived low
- ₹2 seater buyers (Global Fuel quality,
Lakh NCAP) efficient Discontinued

Tata Motors projected production figures of 250,000 annually at launch. This was not achieved, and
various factors led to a decline in sales volume, including delays during the factory relocation from
Singur to Sanand, early instances of the Nano catching fire or the perception of the car being unsafe
and lacking quality due to cost cutting. Actual sales reached 7,591 for model year 2016-2017. The
project lost money, as confirmed by former Tata Sons chairman Cyrus Mistry and by 2017 Tata
Motors management.

In 2017, Tata Motors said manufacturing would continue due to the company's emotional commitment
to the project. Production was eventually halted in May 2018. The Sanand Plant now produces other
hatchbacks like Tiago and Tigor.

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History

After successfully launching the low cost Tata Ace truck in 2005, Tata Motors began development of
an affordable passenger car that would appeal to the many Indians who ride motorcycles. The
purchase price of this no frills auto was brought down by dispensing with most nonessential features,
reducing the amount of steel used in its construction, and relying on low cost Indian labour. This led to
reductions like the passenger's side wing mirror, one wiper blade, only three lug nuts per wheel or
removal of the fuel filler cap from the tank. Tata said it was the first time a 2-cylinder petrol engine
was being used in a car with single balancer shaft.

At introduction the Nano received much media attention due to its low price of 1 lakh rupees (Rs.
100,000). Some promotional material labeled the vehicle as "The People’s Car".

Expectations and effects

Expectations created for the car during the run up to its production were commented as being out of
proportion with realised sales. A 2008 study by Indian rating agency CRISIL projected the Nano
would expand the nation's car market by 65%, but, as of late 2012, news reports have detailed the
underwhelming response of the Indian consumer to the offering; sales in the first two fiscal years after
the car's unveiling remained steady at about 70,000 units. Tata intended to maintain a capacity to
produce the car in much larger quantities, some 250,000 per year, should the need arise.

It was anticipated that its 2009 debut would greatly affect the used car market, and prices did drop 25–
30% prior to the launch.[18] Sales of the Nano's nearest competitor, the Maruti 800, fell by 20%
immediately following the unveiling of the Nano. It is unknown if the Nano has had a lasting effect on
the prices of and demand for close substitutes. In July 2012, Tata's Group chairman Ratan Tata, who
retired in January 2014, said that the car had immense potential in the developing world while
admitting that early opportunities were wasted due to initial problems. Due to the sales drops, only a
single unit was produced in June 2018. The Sanand Plant now produces other hatchbacks like Tiago
and Tigor.

Price

Announced as the most affordable production car in the world, Tata aimed for a price of one lakh
rupees, or ₹100,000, which was approximately $1,334.48 US at the time. Only the very first customers
were able to purchase the car at that price, and as of 2017, the price for the basic Nano started around
₹ 215,000. Increasing material costs may be to blame for this rapid rise in price.

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Compared to the Volkswagen Beetle it had a relatively low price, though still high in terms of the
average salary of an Indian industrial worker or farmer. In 1990, a Beetle from Mexican factories was
priced at $5,300, about $11,872 in today's money. The Ford Model T's initial price was about $850,
equivalent to $27,685 today. The price of the Nano was only just higher than the corrected price of the
Briggs & Stratton Flyer of the 1910s, with the Flyer costing US$125 ($1,767 in 2016), while the Flyer
may today be classified as more of a go-kart than a car.rdable, Fuel efficient Safety concerns,
Perceived low quality, Discontinued.

Comparison Analysis of TATA NANO & MARUTI ALTO 800

Feature Tata Nano Maruti Suzuki Alto 800

Engine: 624cc, 2-cylinder 796cc, 3-cylinder

Transmission: 4-speed manual 5-speed manual

Body Material: Sheet metal Sheet metal

Chassis: Simplified platform Modified WagonR platform

Suspension: McPherson strut (front), semi-independent MacPherson strut (front), trailing arm
(rear) (rear)
Brakes: Drum (front & rear) Disc (front), drum (rear)

Interior Basic plastic and fabric Slightly higher quality plastic and fabric
Materials:
Features: Minimal (no power steering, AC optional) More features (power steering, AC
standard)
Safety Features: No airbags in base model, optional in higher Driver airbag standard, passenger airbag
variants optional
Cost Cutting Smaller engine, basic materials, simplified Smaller engine compared to WagonR,
Measures: design, limited features, single wiper, no power basic materials, simplified design, limited
windows features

 The Nano utilized a single wiper blade to reduce complexity and cost.
 The Alto 800 leveraged an existing platform from the WagonR, reducing development costs.
 Both cars used sheet metal for the body to keep costs down.
 The Nano had a more basic interior with minimal features for affordability.
 The Alto 800 offered slightly more features and slightly higher quality materials.
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Overall:

Both the Tata Nano and Maruti Suzuki Alto 800 employed various cost-cutting measures to achieve
their low price points. However, the Nano took a more radical approach with a smaller engine,
simplified design, and minimal features. The Alto 800 balanced affordability with slightly more
features and quality, ultimately contributing to its greater success.

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 Objective of the project
 To understand and estimate the consumer perception and factors affecting their

behaviour for Choosing or not choosing Tata Nano

 To understand tactics and methods that are used by Tata group to grab the

customers in India.

 To know how consumers are evaluating Tata Nano for their purchase.

 To understand the why it failed in India.

 To study complexities and barriers those are there in between Nano and customers.

 To find out new opportunities and to succeed in those procedures.

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 Literature Review

Rise and Hype

The Tata Nano was unveiled with crazy hype and anticipation. It was marketed as the “world’s
cheapest car” with a price tag of just 1,00,000 Indian Rupees

The car was featured by multiple features like its compact size, fuel efficiency, and the potential to
provide a safer mode of transportation for families Initial Sales Success:

The Tata Nano Initially saw a strong response from the customers with increasing in demand for Tata
Nano car with thousands for pre-orders and sale exceeding expectation.

Challenges and Setbacks:

Several challenges were faced by Tata Nano over its Safety concern, quality issues and incidents like
catching fire.

Repositioning and relaunch:

Tata Motors attempted to reposition the Nano as a more upmarked and feature-rich vehicle to
overcome its initial setbacks.

They introduced new variants, such as the Nano Twist, with improved features and marketing aimed at
a more aspirational audience. Decline and Discontinuation:

Despite being repositioning of Tata Nano, it continued to face challenges including competition from
other low-cost car manufactures and changing consumer preference.

According to the report of Tata Company, NANO entered the Indian roads in the year 2009 and it is
the cheapest car in the world replacing Maruthi 800. This article was an introduction to Tata NANO
car and its features with detailed information on making of NANO. According to this article, buying a
car is the major dream for many people in India, especially for middle income and rural people.

Even though two wheelers are widely used in India, people are still looking to buy car according to
their budget. Ratan Tata owner of Tata Motors specified his views on NANO that it is the only car that
has fulfilled the dream of individuals to buy a car with general income. Tata NANO price is one lakh
Indian rupees which is equal to that of two wheeler price.
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The establishment of NANO can be considered as the competitive strategy of Tata Motors in order to
attract customers of all ends. The detailed information on facts and figures of Tata NANO is explained
in detail and according to TATA report NANO is “the people’s car”.

The significant information available on Tata NANO is explained clearly but still this article should be
improved with new information on review of Tata NANO customers.

Tata NANO is taken as an example in the research process and for this specific reason this article is
used in the research and analyzed according to the research requirements.

The report submitted by PCTI (2011) includes significant information on overview of Tata NANO car
along with its features, benefits etc. This article includes the significant information on conception and
design of NANO car, expectations of customers on NANO introduction, modular design, pricing
strategy and release date etc. On the other hand, this article even explained the impact on NANO car
on Indian economy along with opinions of different analysts on Tata NANO car. This article includes
a table that contains detailed information on entire features of Tata NANO car and their specifications.
This article even explained the information on reviews of different communities of people who has
used Nano cars previously. The actual failures and problems of Tata NANO car are explained clearly.
Finally this article includes the information on major competitors of NANO car such as Bajaj Auto
and some other electric cars.

The future work is required in order to explain more reviews on NANO car in order to identify
whether NANO is a useful car or not.

NANO car is taken as example in the research process and information on NANO is considered from
this article.

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 Research Methodology

i.) Sources of Data:-

The task of data collection begins after a research problem has been defined and research
design plan chalked out. Basically two types of data are available to the research namely:-

 Primary Data:- We collect primary data during the course of doing experiments
research but in case we do research of the descriptive type and performs surveys,
whether sample survey or census surveys, then we can obtain primary data either
through observation or through direct communication with respondents in one form or
another or through personal interviews.
 Secondary Data:- Secondary data means data that are already available i.e., they
refer to the data which have already been collected and analyzed by someone else.

In the present study, primary as well as secondary data has been used.

Sample Design:-

In most of the research design it becomes almost impossible to examine the entire universe.
So the only alternative is to report to sampling. This is true for the present study as well.
Basic principles to be followed in sampling are that the sample chosen must be representative
of entire universe to be studied.

Universe and Survey Population:- Universe is the set of objective to be studied. It can be
finite and infinite. And survey population is a part of universe that represents the whole
universe.

In this present study universe is 120 and survey population is 50 peoples.

Sample Size:-

In this present study I have taken the sample size of 50 peoples to get their views regarding
online shopping.

Sampling Method:-

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In the present study, convenience sampling method has been used.

Data was also collected from the secondary sources of information and these were specifically
based on the strategic marketing of Tata Nano. Data was collected from the journals, researches,
online articles, newspapers and form many other websites (Zikmund,Babin. and Griffin
2013).The main purpose of accessing the information from this variety of secondary sources was
to evaluate excess amount of information on the strategic marketing tactic of Tata. Another
advantage of this method was to recognize that what major improvements can be made by the
company to enhance the effectiveness of its marketing strategies so that customers can influence
in more appropriate way (Daniel and Sam, 2011). All the data which was access from the
secondary mode of data collection was collected from the authentic and valuable sources which
help to form valid conclusion and findings.

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Data Collection Method:-

In dealing with any real life problem it is often found that data at hand are inadequate, and
hence, it becomes necessary to collect data that are appropriate. There are several ways of
collecting data which differ considerably in context of a survey, data can be other resources at
the disposal of the researcher.

Primary Data can be collected through various methods like:-

 Questionnaire method
 Observation Method
 Through Schedules
 Interview method

In the present study Primary data is collected through:-

 Questionnaire

Secondary data can be collected though various methods like:-

 Magazines
 Newspapers
 Websites

In the Present Study Secondary Data is collected through:-

 Different Websites
 Company Journals

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 ii.) SWOT analysis of Tata Nano

Strengths

1. Tata Nano is available at a very affordable price

2. Easy to drive in traffic conditions

3. Innovative engineering of Tata Nano provides better facilities compared to same segment cars

4. Low maintenance and handling cost of Tata Nano

5. Good fuel efficiency goes well with Indian audiences

6. When it was introduced it created a huge buzz in the global automobile industry being a 'common
mans' car

7. Excellent advertising of the Tata Nano car across TVCs, print media, online ads etc.

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Weaknesses

1. Perceived as a cheap product which repels the aspirational customers

2. Setting up of production plant in WB caused a lot of tension

3. Limiter international presence of Tata Nano

Opportunities

1. Tata Nano can capitalize on the fact that it is the most affordable car and acquire new customers

2. Increasing per capita income and purchasing capability of potential customer base

3. Promoting CNG model at the earliest and attract the public. passenger car segment

4. Increase international market presence especially Europe too boost Tata Nano's business

5. Augmenting the distribution and service network in various countries

Threats

1. Increasing fuel costs

2. Competition from other big automobile giants can affect Tata Nano's business

3. Competitive products offering same level features at a lesser price

4. Product innovations and frugal engineering by competitors

5. Customer perception of a Tata Nano as a cheap car can lead to loss of sales

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 Competitor analysis

While the Tata Nano carved its own niche in the automotive landscape, it faced competition from
various established players. Here's a detailed competitor analysis, considering different
dimensions:

Direct Competitors:

1. Maruti Suzuki Alto: The Alto was a direct competitor in terms of price and size. It
offered a slightly more spacious interior and better brand image, contributing to its higher
sales figures.
2. Hyundai Santro: Another direct competitor, the santro was slightly pricier than the
Nano but offered more features and a slightly more modern design, appealing to a
slightly different segment.
3. Renault Kwid: The Kwid, though not as directly comparable in size, also competed in
the affordable segment. Its larger size and slightly higher price point attracted buyers
seeking more space and perceived value.

Competito Price Engine Mileage Safety Space Brand Key Key

r (₹) Capacit (kmpl) Features Image Strengths Weaknesses
y (cc)
Maruti 3.39 796 22.05 - Airbags Small Reliable, Wide Lack of
Suzuki Lac - 31.59 (optional), affordable service power, basic
Alto 5.13 ABS network, features
Lac established
brand
Renault 4.49 799 - 24.38 - Airbags, Small Modern Features, Higher price
Kwid Lac - 999 27.03 ABS design, fuel compared to
6.15 comfortable efficiency Nano
Lac
Datsun 3.39 799 20.7 - Airbags Small Budget- Low power,
redi-GO Lac - 26.01 (optional), friendly, limited
5.24 ABS compact features
Lac size
Hyundai 4.69 1198 - 20.3 - Airbags, Moderate Stylish Higher
Santro Lac - 1197 25.2 ABS design, price, less
6.95 comfortable fuel
Lac efficient

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Indirect Competitors:

1. Second-hand car market: The used car market offered many alternatives to budget-
conscious buyers, often at comparable or lower prices than the Nano. However, these cars
lacked the new-car appeal and warranty of the Nano.

2. Public transportation: In densely populated areas, public transport provided a readily

available and often cheaper alternative to car ownership, especially for short trips.

Competitor Analysis by Dimension:

1. Price: The Nano's main advantage was its significantly lower price point, though
competitors offered slightly more features at slightly higher costs.

2. Size and Space: The Nano's compact size was both an advantage and a disadvantage.
While ideal for navigating city traffic, it offered limited space for passengers and cargo,
compared to some competitors.

3. Features and Amenities: The Nano's basic features were a cost-saving measure but
limited its appeal compared to competitors offering infotainment systems, air
conditioning, etc.

4. Brand Image: The Nano's association with "cheapness" sometimes overshadowed its
practical benefits, while competitors like Maruti and Hyundai enjoyed established brand
images.

5. Safety: The lack of airbags and other safety features in the base model raised concerns,
giving competitors with better safety ratings an edge.

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Feature Tata Nano Maruti Renault Kwid Used Two- Public Car-Sharing
Suzuki Alto Cars Wheelers Transport (Uber/Ola)
(Scooter)
Price Lowest (~₹2 Moderate Moderate Varies Lowest Variable Varies based
Lac) based on ticket costs on usage
model
and year
Size and Smallest, 2 Small, 4 Compact, 5 Varies N/A N/A N/A
Space passengers passengers passengers based on
model
Features Basic (no More features More features Varies Basic Limited Varies based
and power (power (touchscreen based on (storage, (seats, basic on vehicle
Amenities steering, AC steering, AC infotainment, model lights) shelter)
optional) standard) power and year
windows)
Brand Affordable, Established, Modern, Diverse Practical, Eco- Convenient,
Image utilitarian reliable youthful (varies economical friendly flexible
with (some
brands) options)
Safety Basic (no Standard Standard Varies Minimal Minimal Varies based
airbags in airbags airbags based on on driver and
base model) model conditions
and year

Key Takeaways from the Analysis:

 The Nano's success was primarily price-driven, appealing to a budget-conscious segment

seeking basic mobility.
 Competitors offered slightly more features and space at slightly higher prices, catering to
a slightly different segment.
 The Nano's brand image and safety concerns played a role in its limited market share.

Further Considerations:

 The competitor landscape has evolved since the Nano's launch, with new players and
changing consumer preferences.
 Electric vehicles and micro-mobility options are gaining traction, impacting the
affordable car segment.
 Analyzing the Nano's performance in different regions and market segments provides
valuable insights.

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By understanding its competitors and their strengths and weaknesses, Tata can gain valuable
insights for potential future endeavors related to the Nano or similar affordable mobility
solutions. Remember, this analysis provides a starting point, and further research tailored to your
specific project is crucial.

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 Advantages of the product

While the Tata Nano was a significant innovation with ambitious goals, its commercial success
was limited. To present a balanced view, it's important to understand both its advantages and its
limitations.

1. Affordability: The primary advantage of the Nano was its extremely low price point,
making it the cheapest car in the world at launch. This opened car ownership to a
segment of the population who previously couldn't afford it, potentially improving their
quality of life and economic opportunities.

2. Fuel Efficiency: The Nano boasted impressive fuel efficiency, making it a cost-effective
choice for running costs. This was particularly attractive in a country like India where
fuel prices are high.

3. Compact Size: The Nano's small size made it ideal for navigating congested urban
environments and finding parking in tight spaces. It was also easier to maneuver through
narrow streets and traffic jams.

4. Low Maintenance: The Nano was designed with simplicity and low maintenance costs
in mind, making it cheaper to own and maintain compared to larger, more complex
vehicles.

5. Environmentally Friendly: The Nano's small size and efficient engine contributed to
lower emissions compared to many other cars on the road. This could be seen as a
positive environmental benefit.

6. Innovation: The Nano represented a bold attempt to democratize car ownership and
address transportation needs in developing countries. It showcased Indian engineering
capabilities and sparked discussions about affordable mobility solutions.

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 Disadvantage of the product
While the Tata Nano was a significant innovation with ambitious goals, its commercial success
was limited. To present a balanced view, it's important to understand both its advantages and its
limitations.

1. Safety Concerns: The Nano faced criticism for its safety features, particularly the lack of
airbags and other standard safety equipment in the base model. This raised concerns
about driver and passenger safety in case of accidents.

2. Limited Space: The Nano's compact size meant limited space for passengers and cargo,
making it unsuitable for larger families or those carrying significant amounts of luggage.

3. Perceived Quality: The low price point came with compromises in perceived quality and
features, leading to concerns about its durability and overall appeal to certain segments of
the market.

4. Brand Perception: The Nano's association with "cheapness" sometimes overshadowed

its practical benefits, creating a negative brand image that impacted its sales.

5. Shifting Market: The Indian auto market evolved rapidly, with buyers increasingly
prioritizing features, comfort, and safety over just affordability. This made the Nano less
competitive in the changing landscape.

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 Limitation of the study/ Research

The limitations that occurred during the writing of this report are related to the lack of data from
reliable source concerning Tata Motor’s place among its competitors. That is the reason why
such data is not included.

Data Availability:

Limited access to internal data: If you don't have access to confidential data from Tata Motors,
your analysis might rely on publicly available information, which may be incomplete or
outdated.

Market research limitations: Depending on your budget and resources, you might not be able
to conduct extensive primary market research, potentially limiting your understanding of current
consumer preferences and market trends.

Scope and Focus:

Time constraints: A mini project might not allow for an in-depth analysis of all aspects of the
Nano's story. You may need to choose specific areas to focus on, potentially leaving other
important aspects unexplored.

Theoretical framework: Choosing the right theoretical framework to analyze the Nano's case
could influence your interpretations and conclusions.

Methodology:

Quantitative vs. qualitative analysis: Depending on your chosen methodology, you might miss
insights offered by the other approach. Balancing both quantitative and qualitative analysis can
provide a more nuanced understanding.

Selection bias: If you rely on specific case studies or data samples, there might be selection bias
that could skew your findings. Be mindful of the limitations of your chosen data and methods.

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Objectivity and Bias:

Confirmation bias: It's important to be aware of your own biases and assumptions that might
influence your interpretation of the data and conclusions you draw.

Lack of counter-arguments: Consider presenting contrasting viewpoints and addressing

potential criticisms of your analysis to ensure a balanced and objective report.

Generalizability:

Time-bound case study: The Tata Nano's story unfolded over a specific period with unique
market conditions. Applying your findings to the present or future scenarios might require
careful consideration of changes in the market and industry.

Cultural and geographic limitations: Insights gained from the Nano's case in India might not
be directly applicable to other cultural contexts or markets.

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 Suggestion
While the Tata Nano wasn't the commercial success originally envisioned, there are still insights
and potential avenues for the Tata company to explore related to the Nano or its underlying
concept of affordable mobility. Here are some suggestions an MBA student might offer:

1. Rebrand and Refine:

 Target a specific segment: Identify a specific market segment with unmet needs, like
first-time young buyers or rural families, and tailor the Nano or a similar concept to their
preferences.
 Upgrade safety features: Address safety concerns by incorporating essential features
like airbags and sturdier construction, even if it raises the price slightly.
 Modernize design and features: Update the design and add features like infotainment
systems or basic creature comforts to enhance appeal without compromising
affordability.
 Reposition as an "eco-friendly" option: Highlight the Nano's fuel efficiency and low
emissions, appealing to environmentally conscious consumers.

2. Explore Alternative Mobility Solutions:

 Electric Nano: Develop an electric version of the Nano to capitalize on the growing EV
market and offer a sustainable, affordable option.
 Subscription or car-sharing model: Offer the Nano through subscription or car-sharing
services, making it accessible for short-term needs or those who can't afford full
ownership.
 Focus on micro mobility: Look into developing even smaller, electric micro-vehicles for
congested urban areas and last-mile connectivity.

3. Leverage Existing Strengths:

 Rural market penetration: Expand sales and service networks in rural areas where
affordability is a key concern.
 Local production and sourcing: Utilize local production and sourcing to further reduce
costs and promote sustainability.
 Financial partnerships: Partner with financial institutions to offer easy financing
options for potential buyers.

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4. Conduct Market Research:

 Understand changing consumer preferences: Conduct thorough market research to

understand evolving needs and preferences in the targeted segment.
 Gauge willingness to pay for improvements: Evaluate consumer willingness to pay for
additional features and safety upgrades without sacrificing affordability.
 Assess competition and market trends: Analyze the competitive landscape and identify
potential opportunities or threats in the affordable mobility space.

It's important to acknowledge that successfully reviving the Nano or introducing a similar
concept will require careful consideration of its past limitations and adaptation to the evolving
market dynamics.

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 Conclusion

The Tata Nano - A Legacy of Innovation and Lessons for the Future

The Tata Nano, while not the resounding success initially envisioned, represents a significant
chapter in the automotive industry and Tata's journey. Its affordability opened car ownership to a
new segment, while its compact size and fuel efficiency addressed specific needs in developing
markets. However, safety concerns, limited space, and brand perception ultimately hindered its
widespread adoption.

As an MBA student, I believe the Nano's legacy extends beyond its commercial performance. It
offers valuable lessons for Tata and other companies seeking to develop affordable mobility
solutions:

 Understanding market needs: Deeply understanding the target segment's aspirations,

constraints, and willingness to pay is crucial for success.
 Balancing affordability with safety: Striking the right balance between affordability
and essential safety features is critical for responsible innovation.
 Brand perception and positioning: Carefully crafting the brand image and positioning
the product to resonate with the target audience is essential.
 Adapting to evolving markets: Staying ahead of changing consumer preferences and
market trends is vital for long-term success.
 Looking forward, Tata could leverage the Nano's underlying concept and learnings to
explore new avenues in affordable mobility. This could involve:
 Refining the Nano: Addressing safety concerns and incorporating modern features while
maintaining affordability could cater to specific segments.
 Electric Nano: An electric version could capitalize on the growing EV market and offer
a sustainable, affordable option.
 Alternative mobility solutions: Exploring micro-mobility options or subscription
models could cater to diverse needs and urban environments.

Ultimately, the Nano's story reminds us that innovation is not just about technology, but also
about understanding the market, addressing real needs responsibly, and adapting to changing
dynamics. By learning from the past and embracing new opportunities, Tata can continue to play
a leading role in shaping the future of affordable mobility.

38
 Reference

https://www.slideshare.net/amanahuja3766/case-study-on-tata-nano

https://www.marketing91.com/marketing-mix-tata-nano/

https://www.linkedin.com/pulse/analysis-marketing-strategy-tata-nano-kumar-utkarsh

https://www.mbaskool.com/brandguide/automobiles/5019-tata-nano.html

https://www.slideshare.net/narasimhashetty1/tata-motors-horizonext-strategy

https://www.business-standard.com/article/markets/tata-motors-gains-62-from-feb-lo
w-on-tata-sons-stake-buy-improved-outlook-119041500452_1.html

https://www.marketing91.com/porters-force-analysis-tata-nano/

The Tata Nano: The peoples car author Paul Farris Article in SSRN Electronic Journal ·

June 2009 Wikipedia: About historical background of Tata Group of organisations

Tata Nano failure case study by startuptalky.com
Tata Nano: Case of Repositioning

case analysis by

www.researchgate.net Tata Nano

case study analysis by

www.SlideShare.net

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 Annexure

Market Survey: Consumer’s View on TATA Nano

PERSONAL DETAILS

 NAME:________________________________________________
 AGE: _______ yrs
 GENDER:_________
 OCCUPATION:___________________________
 ADDRESS:_____________________________________________

1. What is the first thing which comes to your mind when you think about NANO?
______________________________________________________________________________

2. Instead of purchasing a Bike, will you prefer to go for a NANO

a) yes

b) no

3. Which feature of Nano attracts you the most and inspires you to go for it?

a) Mileage

b) design

c) interior space

d) can’t say

e) All the above

4. Which colours of Nano do you prefer?

a) Red

b) Blue

c) White

d) Yellow

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e) Silver

5. For what purpose you would like to use Nano?

a) Will offer it to your children to use it in place of a two- wheeler

b) Will use it as family car for shopping and travel

c) Will prefer as a taxi

d) Would like to have as a taxie) Others- Specify

6. Do you think Nano is a people’s car?

a) Yes

b) No

c) Can’t say

7. Will you recommend NANO to your friends?

a) Yes

b) No

c) Can’t say

8. Which small car would you prefer to buy?

a) Alto

b) Nano

c) Other

9. How will you feel if Nano is used as a taxi?

a) it’s a great concept

b) I don’t think it’s a good idea

10. Can you trust Nano for safety?

a) Yes

b) No

c) Can’t say

41
11. Are you satisfied with Nano’s service?

a) Yes, fully satisfied

b) Average

c) Less than average

d) No, very disappointed with Nano’s service

12. What is the rate of fuel consumption for Nano?

a) Low

b) Average

c) Better

13. Participant is fully aware of Nano’s Offer’s and Promotions?

a) Yes, fully aware

b) No, not fully aware

c) Not at all aware

14. Why will you buy Nano?

a) Low Price

b) After sales service

c) Attractive looks

d) Comfort and convenience

e) Patriotism. It’s an Indian car.

f) I won’t buy it

15. When it comes to comfort and convenience, Nano is

a) Very comfortable and convenience

b) Average

c) Less than average

d) Not at all comfortable

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16. Do you think Nano is designed and built according India’s local weather and

road conditions?

a) Yes

b) No

c) Not fully

17. According to your opinion what can be done to improve Nanos’ sales in local markets?

a) Nano should provide new models

b) Improve quality and so that car maintenance cost is decreased

c) Should reduce car prices

d) Lower installments

e) Others – Specify

18. Overall satisfaction level has derived as expected from Nano?

___________________________________________________

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