TATA NANO (THE SUCCESS

STORY)

REVIEW ON TATA GROUP

Founded in 1868 by Jamsetji Tata Present Chairman – Ratan Naval Tata Operates in seven different sectors –

Engineering, Materials, Energy, Services, Consumer products, Chemicals and IT.

Empowers 96 companies across 6 continents

Human assets – 6,50,000 in number Total Revenue 2008-09 – 325,334 Crore

TATA’S TALE OF PAST GLORY

Brand Finance – valued the Tata Brand at $9.92billion ranked 51st among world’s 100 brands

Reputation Institute ,USA – ranked

11th as world’s most reputable

companies Tata motors -6th largest commercial

manufacturer in the world and

largest Indian automobile companies In 2004 – Tata Motors – listed as

1st Indian manufacturing company on

New York Stock Exchange 2004 – Acquired Daewoo motors 2005 – Acquired 21% stake in Hispano Carrocera SA In May,2008 –Acquired the British automotive icons

Jaguar and Land Rover from Ford Motor Co.

SCOPE Automobile ownership in India – 8 to 25 of 1000 people. Country Motor Vehicles per 1,000

United States 765

Australia 619

Canada 563

Germany 546

Japan 543

United Kingdom 426

India 12

China 10

In 2007 – India’s two wheeler market- second largest globally – 8 million units sold

In 2011 – production forecasted upto 18million units

Cost – INR 37,000

Vehicle Gas mileag

e(km/liter)

Cost (INR)

Market Speed (kph)

Moped, mokick, orstep-thru

55–70 15,000–40,000

Teens, and elderly

40–45

Scooterette/mini

55 20,000–25,000

City riders, students

65

Scooter 40-60 25,000–50,000

women,city riders

70 and up

Motorcycle Upto 70 35,000–75,000

men 80 and up

Enfields Diesel Bullet

66 65,000 Seekers of “India’sHarley-

Davidson”

80 and up

CONT.

Three – wheelers Bajaj Auto – dominated the Passenger – carrying three wheeler

market “autorickshaws” Faced competition from Tata Ace and

Piaggio’s Ape truk

PRODUCT AND ITS FEATURESTATA NANO

10 January,2008 – Tata Motors unveiled its “People’s car” at 9th Auto Expo in New Delhi

Cheapest Car – INR 1Lakh Launched in two versions – two cylinder

gasoline powered and diesel version World’s most fuel efficient cars – 22Km/L

in city and 26Km/L on Highways Smallest and Comfortable car – 21%

greater seating room than Maruti 800

FEATURES Air conditioning Power steering Power windows A Tachometer Dual windshield wipers Streamlined modular design Easy to assemble – car component parts could be

built at separate facilities and shipped to local manufacturer for assembly

( Manufacturing plants in Jamshedpur, Pune and Lucknow and assembly operations in Malaysia, kenya , Bangladesh, Spain, Ukraine, Russia and Senegal. Globally caters to Europe, Africa, Asia, Middle East and Australia)

Plan to setup three additional plants- to sell 1 million units annually

TARGET AUDIENCE

Middle class families – more comfortable, safe and spacious journey

College going students People owning second hand car People depending on public transport People owning two – wheelers (If Nano Manages to convert 10% of two wheeler market, it

will have 50% of car market share – lead to 20% reduction in prices of two wheeler and 35% reduction on second hand cars)

PRICE

World’s cheapest car Payable cost – INR 1 Lakh

+ 12.5%value added tax

+ charges (road and transportation

tax) Research report by the Credit Rating

and Information Services of India Ltd.

– Expand the number of

households that can afford a car

by 65% On-road price – INR 1.3 Lakh Can be afforded by families with 2Lakh Income level

PLACE

INDIA – Jamshedpur, Pune and Lucknow World’s third largest economy by 2020 2005-06 – largest and fastest growing car markets in

world Passenger car market – 25% annually Passenger vehicle exports – 12.7% annually Exports to Asia and Africa – 8,50,000 units in 2005-06 India exports

Passenger cars – 1,70,000 units

Commercial vehicle – 40,000 units

Three wheelers – 77,000 units

PROMOTION

World’s cheapest car – INR 1.3 Lakh World’s most Fuel Efficient car Attractive Design and great looks – appealing

to middle class families Provide a much more safer and comfortable

transportation to people dependent on two wheelers, second hand cars or Public transports

DEALERS Cars sold via dealer networks ( sales

volume depends on extent of network and sales per dealer)

Manufacturer Number of

DealersSales (Units) per Dealer

Maruti 580 1,275

Hyundai 225 800

Tata Motors 200 1000

Ford 125 225

GM 100 600

Tata’s dealer margins – 4% to10% Profit margin received by dealers –

USD75 for the USD2,500 Tata dealer’s satisfation – Dealers

increased the number of service stations and outlets in few months

COMPETITORS Six major players in passenger vehicle

segment Passenger Vehicles - Percentage of

Market Share Maruti Udyog - 52.2 Hyundai Motors India Ltd. - 19.2 Tata Motors - 16.6 Honda Siel Cars India Ltd. - 4.4 Ford India Pvt. Ltd. - 1.9

MARUTI 800 AND ALTO - THE BIGGEST COMPETITOR

Closest price competitor –

USD 5000

Biggest brand name

Highest market share

OTHER COMPETITORS

Two wheelers

• Bajaj Auto, Hero Honda, TVS Motors, Yamaha Motor and Kinetic

Three wheelers and Public Transport

• Tata Ace

DOWNTURNS In stock price – from USD 18,60/share (Sept 2007) to

USD 9,53/share (Sept 2008)

In mid-2008- increase in cost of materials used in car assembly – from 13% to 23%

Protest from farmers and govt put on hold the bulk manufacturing of Nano before its launch

Declared “Environmental unfriendly”

CONCLUSION Has given a new definition to low price,

affordable, safe and comfortable transportation

Features such as low price and small price has lured the middle class families and college students who could only afford a two wheeler or a second hand car

Catered to the needs of Population who were only dependent on public transport

Broaden the spectrum and increased the choices in small cars segment

In addition to all these features a focus on the safety and emission standards should be there to make the car environmental friendly