Research Project ReportOn

THE STUDY INTO THE PROCESS OF PRODUCT PLANNING AND DEVELOPMENT IN MARKETING

For the partial fulfillment of the requirement ofMASTER OF BUSINESS ADMINISTRATIONAffiliated to Uttar Pradesh Technical University, Lucknow, (U.P.)(2013-2015)

Under The Guidance of: Submitted by:Dr. Avijit Dey Mr. Ankit Kumar

Roll No.1327270012

GNIT MBA Institute6-C, Knowledge Park-II, Greater Noida ( G. B. Nagar)

TOPICS Institutes Certificate Acknowledgement Preface / Executive Summary 1. INTRODUCTION (1-16)2. INDUSTRY PROFILE (17-24)3. COMPANY PROFILE (25-57)4. FINANCIAL ANALYSIS OF THE COMPANY (58)5. DATA ANALYSIS & INTERPRETATION OF DATA (59-70)6. FINDINGS (71)7. CONCLUSIONS (72-73)8. SUGGESTIONS (74)9. LIMITATIONS OF THE STUDY (75)10. APPENDICES (76-83)11. BIBLIOGRAPHY (84)

ACKNOWLEDGEMENT

I feel an immense pleasure in taking this opportunity to express my sincere thanks and deep gratitude towards my honourable guide Dr. Avijit Dey, for designing of the project and being a constant source of inspiration and guidance. It has been a great privilege for me to his constant encouragement, meticulous guidance and invaluable counsel throughout the conduct of the project. I shall be failing in my duty if I do not acknowledge my thanks to DR. SAVITA MOHAN, DIRECTOR, GNIOT MBA INSTITUTE, without whose guidance and cooperation would havent been successfully accomplished.

DATE: ANKIT KUMAR

EXECUTIVE SUMMARY

This is the specialization project on a study on new product development for Tata Nano along with a comparative study between Tata Nano and Maruti 800. The objective of this study is to gain knowledge about how Tata brought this new product.During the project I researched on how Tata developed Nano costing Rs 1 lakh and what will be its effects. This study also includes comparison between Tata Nano and Maruti800. A survey was also done for understanding consumer buying pattern and preferences.Thus, this study is based on new product development in marketing for Tata Nano.

1. INTRODUCTION

History of Product Planning:

Modern production planning methods and tools have been developed since late 19th century. UnderScientific Management, the work for each man or each machine is mapped out in advance (see image). The origin of production planning back goes another century.Kaplan(1986) summarized that "the demand for information for internal planning and control apparently arose in the first half of the 19th century when firms, such as textile mills and railroads, had to devise internal administrative procedures to coordinate the multiple processes involved in the performance of the basic activity (the conversion of raw materials into finished goods by textile mills, the transportation of passengers and freight by the railroads. Herrmann (1996) further describes the circumstances in which new methods for internal planning and control evolved: "The first factories were quite simple and relatively small. They produced a small number of products in large batches. Productivity gains came from usinginterchangeable partsto eliminate time-consuming fitting operations. Through the late 1800s, manufacturing firms were concerned with maximizing the productivity of the expensive equipment in the factory. Keeping utilization high was an important objective. Foremen ruled their shops, coordinating all of the activities needed for the limited number of products for which they were responsible. They hired operators, purchased materials, managed production, and delivered the product. They were experts with superior technical skills, and they (not a separate staff of clerks) planned production. Even as factories grew, they were just bigger, not more complex."About production planning Herrmann (1996) recounts that "production scheduling started simply also. Schedules, when used at all, listed only when work on an order should begin or when the order is due. They didn't provide any information about how long the total order should take or about the time required for individual operations. In 1923Industrial Managementcited a Mr. Owens who had observed: "Production planning is rapidly becoming one of the most vital necessities of management. It is true that every establishment, no matter how large or how small has production planning in some form; but a large percentage of these do not have planning that makes for an even flow of material, and a minimum amount of money tied up in inventories.

Meaning Of Product:E.g.:- milk, computer, shoes, service after sales, railway services etc. a product can be divided into two categories Tangible goods Intangible goodsTangible products are known as goods that can be touched, felt and seen. E.g.:- computer, mobile phone etcIntangible products are known as services that cannot be touched and seen as the customer can feel and experience only after utilizing it. E.g.:- service after sales New Product Development:

A product can be considered new under the following situations:- New-to-the-world products New product lines Additions to existing product lines Improvements and revisions of existing products Repositioning Cost reductions

Stages Of New Product Development

Before the introduction of a product into the market, it goes through several stages of development. These stages are known as stages of new product development. It includes the following:Idea Generation:Companies seek new ideas to enhance the performance of the existing products and to innovate new ideas. This stage is called idea generation stage. There are many sources for idea generation. It may be from customers, dealers etc.Employees throughout the company can also be a source of idea. Toyota claims that its employees submit two million ideas annually over 85% of which are implemented.Companies also find good ideas by researching competitors products and services. They can find out what the customers like or dislike about their competitors products. Ideas can also come from investors. External research, surveys industrial publications research and development etc.But the main source of idea generation is the customers by their grievances and complains and feedback. However, although ideas can flow from many sources, it is not feasible to implement all the ideas generated due to lack of time and capital.Idea ScreeningThe main purpose of idea generation is to collect a larger number of ideas. However, not all ideas can be commercially viable. Therefore, the companies filter the less viable ideas with the help of systematic process. Companies can use various parameters to screen the ideas such as market size, technical capabilities, potential competition etc.

Addressing the following issues will also help the companies to analysis the attractiveness of ideas. Whether the product idea match the existing products of the company. The degree to which the new product can cannibalize the sale of the existing product. Companys ability to produce and market the product. Buying behavior and the probable changes in the environment.While screening the ideas, an organization may commit two types or errors.Drop error where the firm rejects a very good idea.Cro error where a company selects a poor idea.

Concept Testing And Development:All ideas that survive in the process of screening will be studied in details. They will be developed into mature products. At this stage, the idea is submitted for the external evaluation to get a feedback from the market. It helps a firm are organization to collect important information like customers initial reactions towards the product development. During this stage, new product idea is described in the form of one or more benefit that is then presented to a sample of potential customers for their reactions.Marketing Strategy:Following a successful concept test, the new product manager will develop a preliminary strategy plan for introducing new product in the market. The plan consists of three parts. The first part describes the target market size, structure and behavior for the first few years. The second part outlines the planned price distribution strategy and marketing budget for the 1st year. The third part of marketing strategy plan describes the long run sales and profit goals and the marketing mix strategy over time.

Business Analyses.After management develops the product concept and market strategy, it can evaluate the business attractiveness. Business analyses are the first in-depth financial evaluation of new product to be developed. Here management needs to prepare sales cost and profit projections to determine whether they satisfy company objectives. If they do, then concept can move to the development stage. SOWT analysis will be conducted at this stage by the organization. It also includes the following:

Total sales estimation:-These are the sum of estimated first- time sales, replacement sales and repeat sales. Its method depends upon whether the product is one time purchase(an engagement ring), an infrequently purchased products like toaster, auto mobile etc. or a frequently purchased products like consumer and industrial non durables.Estimation costs and profits.The R&D, manufacturing, marketing and financial departments estimates the costs. The profitability of the new product is estimated through various financial tools. The simplest technique is the breakeven analysis in which the management estimates how many units of the product the company would have to sell to break even with the given price and cost structure. If the management believes that sales could easily reach the break even number, it is likely to move the project into development stage.

Product DevelopmentIn this stage, detailed technical analysis is conducted to know whether the product produced at costs is low enough to make the final price attractive to the customer.Here a working model or a prototype is developed to disclose all tangible and intangible attributes of the product. A product protocol is prepared which is a detailed downiest containing the important attributes that are expected in the product. Once the protocol has been developed, it is handed over to the research the development department to develop the prototype of the product.

Test Marketing:The test marketing is the stage where the product is introduced in a few selected cities. During this stage, the company has to fate the following expense: High advertisement High manufacturing cost. High distribution cost etc.For testing the product, marketer needs to make the decision on the following issues. The no. of cities in which the product is to be tested. Geographic location of the cities. Time to carry ort test marketingThrough this exercise, company can know the customers response, feedback, suggestions, complaints and any other changes required to be done for product modification.After successfully laughing the product in selected cities the company launches the new product in all other cities.There are certain methods of product testing.

Alpha TestingIn this method, a group of target audience is selected from the employees of the company.Beta Testing:It is carried out at the customers site. Generally, it is applicable for industrial products where the customization takes place.Gamma Testing:It is carried out on a long term basis where the customers uses the product extensively and gives response after a long period of time. Say six months.

Commercialization:The results of the test marketing help marketers to decide the changes that are needed in the marketing mix before entering into the market. It also helps the marketer to decide the amount of production distribution strategy, selling efforts and other issue like providing guarantees, service after sales etc. the product enters the market during the commercialization stage.

Research objectives

To study about how a new product- Tata Nano was developed based on marketing theory of new product development. To study about what made possible for Tata to develop and produce a car for just Rs. One lakh. To study the objectives and target customers of Tatas one lakh car To study and compare between Tata Nano and Maruti 800To study on customers buying behavior and preferences and views about Tata Nano and Maruti 800 by various methods of data collection.

RESEARCH METHODOLOGY

Research methodology is simple framework or plan for the study that is as guide in collection and analyzing the data. It is the blue print that is followed in completes the study. Thus, good research methodology ensures the completion of project efficiency and affectivity. Since there are many aspect of research methodology, the line of action has to be chosen from the variety of alternatives, to choose the suitable method through the assessment from various alternatives. Research methodology gives the researcher an opportunity to put forward his argument for having opted for certain alternatives and also at the same time he can justify his ruling out some other possibility likes. Why research study has been undertaken, how the research problem has been formulated what data has been collected, what particular technique if analyzing the data has been used and lot of similar type question are usually answered when we talk of research problem in study.

Sample Design: 69 responsdentsSample Composition: Youth Service Class HousewivesThe details of the methodology adopted are presented below:The QuestionnaireKeeping in view the objective of the study, questionnaire was designed and tested on few employees. After getting the proper response and sanction from the concerned department the questionnaire was finalised.

PRIMARY DATA Market Survey. Personal Interview.

SECONDARY DATA Magazines. Internet. Business Journal.

Data Collection MethodsThe success of any project or market survey depends heavily on the data collection and analysis. It is necessary that the data collected is a reliable data in order to achieve the research objective. For research regarding the views of people about Tata Nano and its comparison between Tata Nano and Maruti 800 two types of data collection methods were used Primary Data Secondary Data

PRIMARY DATA:Primary data is the data, which are fresh and collected for the first time, and are original in character. There are various Primary Data Collection techniques, which have helped in data gathering. This was collected through questioner.Questionnaires are a popular means of collecting data, but are difficult to design and often require many rewrites before an acceptable questionnaire is produced.Advantages: Can be posted, e-mailed or faxed. Wide geographic coverage. Relatively cheap. No prior arrangements are needed. Avoids embarrassment on the part of the respondent. Respondent can consider responses. No interviewer bias.

Disadvantages: Design problems. Questions have to be relatively simple. Time delay whilst waiting for responses to be returned. Several reminders may be required. Assumes no literacy problems. No control over who completes it. Not possible to give assistance if required. Problems with incomplete questionnaires.

Points kept in mind while preparing the questioner Liberal spacing Length of the questioner is kept normal Logical Order Question are short, simple and to the point; all unnecessary words are avoided Close ended questions are asked so that its easy for the respondent to fill the questioner and also easy to analysis Sample population was selected on the basis of random sampling method.

SECONDARY DATA:Secondary data are those data, which have been already collected or published for the purpose other than specific research need at hand. This data is simply used up by the researcher for his purpose of collected data and its used for the same purpose. The secondary data sources here in this project are: Websites Books

2. INDUSTRY PROFILE

The automobiles sector is compartmentalized in four different sectors which are as follows: Two-wheelerswhich comprise of mopeds, scooters, motorcycles and electric two-wheelers Passenger Vehicleswhich include passenger cars, utility vehicles and multi-purpose vehicles Commercial Vehiclesthat are light andmedium-heavy vehicles Three Wheelersthat are passenger carriers and goods carriers.The automobile industry is one of the key drivers that boosts the economic growth of the country. Since the de-licensing of the sector in 1991 and the subsequent opening up of 100 percent FDI through automatic route, Indian automobile sector has come a long way. Today, almost every global auto major has set up facilities in the country.Austria based motorcycle manufacturer KTM, the established makers of Harley Davidson from the US and Mahindra & Mahindra have set up manufacturing bases in India. Furthermore, according to internal projections by Mercedes Benz Cars,India is set to become Mercedes Benzs fastest-growing market worldwide ahead of China, the US and Europe.As per the data published by Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce, Government of India, the cumulative FDI inflows into the Indian automobile industry during April 2000 to October 2013 was noted to be US$ 9,079 million, which amounted to 4% of the total FDI inflows in terms of US $. The production of compact superbikes is also expected to take place in India. The country has a mass production base of 16 million two-wheelers and the several global as well as Indian bike makers are looking forward to use it as an advantage in order to roll out sports bikes in the 250 cc capacity.The world standing for the Indian automobile sector, as per the Confederation of the Indian industry is as follows: Largest three-wheeler market Second largest two-wheeler market Tenth largest passenger car market Fourth largest tractor market Fifth largest commercial vehicle market Fifth largest bus and truck segmentHowever, the year 2013-2014 has seen a decline in the industrys otherwise smooth-running growth. High inflation, soaring interest rates, low consumer sentiment and rising fuel prices along with economic slowdown are the major reason for the downturn of the industry.Except for the two-wheelers, all other segments in the industry have been weakening. There is a negative impact on the automakers and dealers who offered high discounts in order to push sales.To match the decline in demand, automakers have resorted to production cuts and lay-offs, due to which capacity utilization for most automakers remains at a dismal level.Despite the comprehensive market being under extreme burden, the luxury car market has observed a robust double-digit hike during the year 2013-2014, as a result of rewarding new launches at compelling lower price points. Further, with the measured increases in the price of diesel, the overall market continues to shift towards petrol-fuelled cars. This has lead to the growth in sales of the 'Mini' segment of the PV market by of 5.5%Factors determining the growth of the industry Fuel economy and demand for greater fuel efficiency is a major factor that affects consumer purchase decision that will bring leading companies across two-wheeler and four-wheeler segment to focus on delivering performance-oriented products. Sturdy legal and banking infrastructure Increased affordability, heightened demand in the small car segment and the surging income of the Indian population India is the third largest investor base in the world The Government technology modernization fund is concentrating on establishing India as an auto-manufacturing hub. Availability of inexpensive skilled workers Industry is perusing to elevate sales by knocking on doors of women, youth, rural and luxury segments Market segmentation and product innovationEmployment OpportunitiesThere are a wide range of jobs available in the automobile industry. With the number of vehicles available on the road today, the need and requirement for people who can fix these machines is fast increasing. Careers like automobile technician, car or bike mechanics are a great option. Becoming a diesel mechanic is also a significant alternative. Diesel mechanics are responsible for repairing and servicing diesel engines. As they are also required to repair engines of trucks and buses, other than cars, they are provided with hefty wages.If communication with people instead of repairing cars is what interests you, then you have the opportunity of becoming a salesperson or sales manager in an automobile company. Career opportunities in automobile design, paint specialists, job on the assembly line and insurance of vehicles is also available.Employment TrendsThe Automotive Mission Plan for the period of 2006-2016 aims to make India emerge as a global automative hub. The idea is to make India as the destination choice for design and manufacture of automobiles and auto components, with outputs soaring to reach US$ 145 billion which is basically accounting for more than 10% of the GDP. This would also provide further employment to over 25 million people by 2016 making the automobile the sunrise sector of the economy.According to the Confederation of Indian Industry, the automobile sector currently employs over 80 lac people. An extension in production in the automobile industry is forecasted, it is likely to rise to Rs. 600000 crore by 2016.Future Trends in the Automobile IndustryAs the auto-shows began in January 2014, the industry promised a blend of technology and automotives. With the recession trend breaking its leashes form the past two years, 2014 is expected to get back on track with the sales of automobiles in the country. Almost Self-governing cars are predicted to be on the streets by 2020 More than half the cars on the streets are going to be powered by diesel by 2020 Industry watcher Gartner indicates that 30 percent of motorists want parking info. The facility is likely to come up after glitches in the infrastructure catch up. High Performance Hybrid cars are likely to gain greater popularity among consumers.The Indian automobile industry has a prominent future in India. Apart from meeting the advancing domestic demands, it is penetrating the international market too. Favoured with various benefits such as globally competitive auto-ancillary industry; production of steel at lowest cost; inexpensive and high skill manpower; entrenched testing and R & D centres etc., the industry provide immense investment and employment opportunities.

With a scintillating 2.3 million units produced in 2008 the Indian automobile industry bagged the position of being the ninth largest in the world. Following economic liberalization, Indian domestic automobile companies like Tata Motors Maruti Suzuki and Mahindra and Mahindra expanded their production and export operations in and across the country and since then the industry has only shown signs of growth. The automobile industry comprises of heavy vehicles (trucks, buses, tempos, tractors), passenger cars, and two-wheelers.

The Indian automobile industry seems to come a long way since the first car that was manufactured in Mumbai in 1898. The automobile sector today is one of the key sectors of the country contributing majorly to the economy of India. It directly and indirectly provides employment to over 10 million people in the country. The Indian automobile industry has a well established name globally being the second largest two wheeler market in the world, fourth largest commercial vehicle market in the world, and eleventh largest passenger car market in the world and expected to become the third largest automobile market in the world only behind USA and China.

The growth of the Indian middleclass along with the growth of the economy over the last few years has resulted in a host of global auto giants setting their foot inside the Indian Territory. Moreover India also provides trained manpower at competitive costs making the country a manufacturing hub for many foreign automobile companies. India proves to be a potential market as compared to most of the other countries which are witnessing stagnation as far as automobile industry growth is concerned.

A recent research conducted by the global consultancy firm Deloitte says that at least one Indian automobile company will feature among the top six automobile companies that will dominate the car market by 2020.

The Indian automobile industry proved to be in good shape last year even after the economic downturn. This was majorly due to the fact of renewed interest shown by global automobile players like Nissan Motors which consider India to be a potential market.

As far as authorized dealer networks and service stations are concerned Maruti Suzuki is the most widespread. The other automobile companies are also showing rapid progression in this field.

Indian Automobile Export market

India is a very favorable market for small cars be it production, sales or export. Since the Indian automobile industry is the largest manufacturer of small cars companies like Hyundai and Nissan Motors export about 2,40,000 and 2,50,000 annually. India emerged as Asia's fourth largest exporter of automobiles, behind Japan, South Korea and Thailand. The Indian automobile exports registered a 22.30 percent growth in the year 2009. The growth trend was as follows: Two Wheelers- 32.31 percent, Commercial Vehicle - 19.10 percent and Passenger Cars grew by - 19.10 percent.

Key automobile manufactures in India

Maruti Udyog General Motors Ford India Limited Eicher Motors Bajaj Auto Daewoo Motors india Hero Motors Hindustan Motors Hyundai Motors India Limited Royal Enfield Motors Telco TVS Motors DC Designs Swaraj Mazda Limited

Indian Automobile Industry Growth 2009

Gaining from Government stimulus packages, more demands and lower interest rates on automobile loans the Indian automobile industry witnessed a phenomenal growth of 26.41 per cent in the year 2009. Segment wise cars posted a growth of 25.10 percent and two wheelers sales grew by 26 percent. The year 2009 actually turned out to be one of the best years in the history of the automobile industry in India. If the trend continues the same way then Indian will soon become the second fastest growing automobile market in the world only after China.

Domestic Market Share for 2009 - 2010

AutomobilesMarket Share

Passenger Cars15.86 %

Commercial Vehicles4.32 %

Two Wheelers3.58 %

Two Wheelers76.23 %

Market SizeThe growth story for the Indian automobile industry in 2014 rode on the two-wheeler segment. The segment has clocked positive growth at 12.9 percent year-on-year to reach sales of nearly 13.5 million units by October 2014.India's automobile sector has also picked up pace, with eight of the country's leading manufacturers' reporting combined passenger vehicle sales of 198,427 in November 2014, a 10 per cent annual rise. The rise in sales in November 2014 was led by Maruti Suzuki, whose sales increased 17 per cent to 100,024 units in the domestic market.The commercial vehicles (CV) industry in India has registered an increase of 8.59 per cent in September 2014, as fleet owners have started to buy trucks in the anticipation of an improved economic activity.The automobile sector in Andhra Pradesh has a potential for US$ 1 billion investment and US$ 1.50 billion output, according to a recent analysis by Automotive Components Manufacturers Association of India (ACMA) and city-based Andhra Chamber of Commerce and Industry Federation (ACCIF).

InvestmentsTo match production with demand, many auto makers have started to invest heavily in various segments in the industry in the last few months. The industry has attracted FDI worth US$ 11,351.26 million during the period April 2000 to November 2014, according to the data released by Department of Industrial Policy and Promotion (DIPP).Some of the major investments and developments in the automobile sector in India are as follows: Snapdeal.com has entered into a partnership with Hero MotoCorp Ltd to sell two-wheelers and expect its online automobile sales to generate Rs 1,000 crore (US$ 162.33 million) of business in next six to 10 months. Automotive supplier Uno Minda and Japans Toyoda Gosei Co Ltd have announced a joint venture (JV) partnership to manufacture and sell rubber hoses to automobile makers in India. The JV will be set up with a total investment of Rs 85.3 crore (US$ 13.84 million) in a phased manner. Tafe Motors and Tractors Ltd (TAFE) has invested around US$ 140 million by way of equity in the US-based AGCO Corporation, a worldwide manufacturer and distributor of agricultural equipment. Flipkart founders Mr Sachin Bansal and Mr Binny Bansal have led a US$ 1 million investment in Ather, an electric vehicle start-up focused on designing high-speed electric two-wheelers. Harley Davidson Motor Co. has expanded their line up in India as it has launched three new models the Breakout, Street Glide and CVO limited edition. Hero Electric is looking for merger and acquisition (M&A) options or technology tie-ups to encourage its next generation electric vehicle technology.

Government InitiativesThe Government of India encourages foreign investment in the automobile sector and allows 100 per cent FDI under the automatic route. To boost manufacturing, the government had lowered excise duty on small cars, motorcycles, scooters and commercial vehicles to eight per cent from 12 per cent, on sports utility vehicles to 24 per cent from 30 per cent, on mid-segment cars to 20 per cent from 24 per cent and on large-segment cars to 24 per cent from 27 per cent.Some of the major initiatives taken by the Government of India are: The governments decision to resolve VAT disputes has resulted in the top Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and Tata Motors announcing an investment of around Rs 11,500 crore (US$ 1.86 billion) in Maharashtra. The Automobile Mission Plan for the period 20062016, designed by the government is aimed at accelerating and sustaining growth in this sector. Also, the well-established Regulatory Framework under the Ministry of Shipping, Road Transport and Highways, plays a part in providing a boost to this sector. The Government of India-appointed SIAM and Automotive Components Manufacturers Association (ACMA) are responsible in working for the development of the Indian automobile industry. The government plans to come out with policies to introduce clean fuels such as biodiesel, bioethanol and electricity for public transport vehicles and school buses in big cities to tackle air pollution. The Lok Sabha passed the Motor Vehicles Amendment Bill, 2014, paving the way for regularisation of e-rickshaws. The government has set up National Automotive Testing and R&D Infrastructure Project (NATRiP) at a total cost of US$ 388.5 million to enable the industry to be on par with global standards.

Road Ahead

India is probably the most competitive country in the world for the automotive industry. It does not cover 100 per cent of technology or components required to make a car but it is giving a good 97 per cent, highlighted Mr Vicent Cobee, Corporate Vice-President, Nissan Motors Datsun.The vision of AMP 2006-2016 sees India, to emerge as the destination of choice in the world for design and manufacture of automobiles and auto components with output reaching a level of US$ 145 billion; accounting for more than 10 per cent of the GDP and providing additional employment to 25 million people by 2016.Exchange Rate Used: INR 1 = US$ 0.0162 as on January 21, 2015

3. COMPANY PROFILE

Introduction To Tata Motors: Tata Motors was established in 1945, when the company began making trains. It has its manufacturing base in Jamshedpur, Lucknow, Pune and soon one more plant is going to established at Singur, West Bengal. Product Manufactured - Passenger Cars and commercial vehicle Installed Capacity - 350,000-400,000 vehicles a year Investment - Rs 2,500 crore (Rs 25 billion) Turnover - $21.9 billion (Rs 967,229 million) Employees - 2,46,000/22001 Tata Motors had created the wealth Rs. 320 billion during 2001-2006 and stood among top 10 wealth creators in India.

Tata Nano - ONE LAKH CAR PROJECT Peoples Car

Tata Nano

Overview

ManufacturerTata Motors

Alsocalledone-lakhcar

Production2008present

AssemblySanand Plant,Sanand, Gujarat, India[1]

DesignerGirish Wagh, Justin Norek, Pierre Castinel[2]

Body and chassis

ClassCity car

Bodystyle4-door one-box

LayoutRR layout

Powertrain

Engine2cylinderSOHCpetrolBoschmulti-point fuel injection(singleinjector) all aluminium 420cc(26cuin)

Transmission4 speedsynchromeshmanualwithoverdrivein 4th

Dimensions

Wheelbase2,230mm (87.8in)[3]

Length3,099mm (122.0in)[3]

Width1,495mm (58.9in)[3]

Height1,652mm (65.0in)[3]

Kerbweight600kg (1,300lb)635kg (1,400lb)[3]

TheTata Nanois acity carmanufactured byTata Motors. Made and sold in India, the Nano was initially launched with a price tag of100,000(US$1,600) which was ultimately increased with time. Designed to lure India's burgeoning middle classes away from two-wheelers, it received much publicity.HistoryAfter having successfully launched the low costTata Acetruck in 2005, Tata Motors began development of an affordable car that would appeal to the many Indians who ride motorcycles.The purchase price of thisno frillsauto 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.The introduction of the Nano received much media attention due to its low price. Expectations and effectsExpectations created for the car during the run up to its production may have been out of proportion with its realised success. A 2008 study, by Indian rating agency CRISIL, thought 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 although Tata appears intent on maintaining 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 2530% prior to the launch.Sales of the Nano's nearest competitor, theMaruti 800, fell by 20% immediately following the unveiling of the Nano.[9]It is unknown if the Nano has had a lasting effect on the prices of and demand forclose substitutes, however. 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 on opportunities were wasted due to initial problems.Singur factory pulloutMain article:Tata Nano Singur controversyTata Motors announced in 2006 that the Nano would be manufactured inSingur, West Bengal.]Local farmers soon began protesting the forced acquisition of their land the new factory entailed. Tata first delayed the Nano launch and later decided to build the car in a different state,Gujarat, instead. PriceAnnounced as the most affordableproduction carin the world, Tata aimed for a price of onelakhrupees, or100,000, which was approximately $2,000 US at the time.[13]Only the very first customers were able to purchase the car at that price, however, and, as of 2012, the price for the basic Nano is around150,000.[14]Increasing material costs may be to blame for this rapid rise in price.[15]Compared to theVolkswagen Beetleit has a relatively low price, however. In 1990, a Beetle from Mexican factories was priced at $5,300,[16]about $9,567 in today's money. TheFord Model T's initial price was about $850, equivalent to $22,311 today. The second-generation Nano is expected to be sold in the United States by 2015.The original Nano is not street legal in the US, and cannot legally be sold as agrey marketimport until 2034, when the original 2009 models receive a 25-year exemption from theUS Customs and Border Protection.Despite a readily-available dealership network in the US through theJaguar Land Roverdivision of Tata, Tata Motors won't use Jaguar Land Rover to sell the Nano. Cost-cutting features

Tata Nano engine in trunk that's only accessible from inside as a cost reduction feature

Tata Nano dashboard is very simple. CD player and radio on this deluxe model

The car's exterior and interiors were designed at Italy'sInstitute of Development in Automotive Engineering.[4]The Nano's design implements many measures to reduce manufacturing costs.Comparison with the Maruti 800, the Tata Nano's closest competitor:Tata NanoMaruti 800

* The Nano'strunkis only accessible from inside the car, as the rear hatch does not open.[21]* Maruti 800 initially had only an opening rear-windscreen, but later got a full hatchback.

* One windscreen wiper instead of the usual pair (also seen earlier on certain Citroen and Mercedes models)[5]* Two windscreen wipers.

* Nopower steeringinitially, unnecessary due to its light weight.[5]Added in higher variants in later models.* Power Steering only in higher variants.

* Threelug nutson the wheels instead of the usual four (also seen on Smart)[22]* Fourlug nutsper wheel.

* Only onewing mirroron base models. Higher variants fitted with passenger side ORVM from 2012 onwards.[5]* No option for both side ORVMs in any variant.

* Radio or CD player is optional (the idea picked on some basic car models in North America and all basic cars in India)[5]* Radio/CD Player is optional.

* No airbags on any model[23]* no airbag in any variant.

* 624cc rear engine has 2 bigger cylinders (312cc each)[5]* 800cc front engine has 3 smaller cylinders (266cc each).

* No air conditioning in base model (as on most basic car models in Europe and North America)[5]* No air conditioning in base model

* Front passenger seat same as the driver seat, and the headrests are integrated.* Front passenger seat same as the driver seat, but headrests separate. Later models switched to integrated headrests.

* Thinner 135/70-R12 space saver spare tyre.* Full size spare tyre.

* No external fuel filler cap. Fuel inlet is accessed by opening the front hood.* External fuel filler cap.

* Front door power windows only offered on highest variant. PW switches placed on central console rather than on door pads.* Front door power windows only offered on highest variant.

Technical specifications The Nano (2012) is a 38PS (28kW; 37hp) car with a two-cylinder 624 ccrear engine.The car complies withBharat Stage 4 Indian Emissions Standards, which are roughly equivalent to Euro 4 and can meetEuropean emission standards as well.The development of the Nano had led to 31 design and 37 technology patents being filed.Engine:2cylinderpetrol withBoschmulti-point fuel injection(singleinjector) all aluminium 38 metric horsepower (28kW) 624cc(38cuin)

ValueMotronicengine management platformfromRobert Bosch GmbH

2valvesper cylinder overheadcamshaft

Compression ratio: 9.5:1

borestroke: 73.5mm (2.9in) 73.5mm (2.9in)

Power: 38PS (28kW; 37hp) @ 5500 +/-500rpm

Torque: 51Nm (38ftlbf) @ 3000 +/-500rpm

Layout and TransmissionRear wheel drive

4-speedmanual transmission

Steeringmechanicalrack and pinionw/o servo

Turning radius: 4 metre

PerformanceAcceleration: 0-60km/h (37mph): 30 seconds

Maximum speed: 105km/h (65mph)

Fuel efficiency(overall): 25.35 kilometres per litre (4.24 litres per 100 kilometres (66.6mpg-imp; 55.5mpg-US))

Body and dimensionsSeat belt: 4

Trunkcapacity: 150L (5.3cuft)

Suspension, Tires & BrakesFront brake: 180mmdrum

Rear brake: 180mmdrum

Front track: 1,325mm (52.2in)

Rear track: 1,315mm (51.8in)

Ground clearance: 180mm (7.1in)

Frontsuspension:MacPherson strutwith lower A arm

Rear suspension: Independentcoil spring

12-inch wheels[26]

Supplier[27]Part/system[27]

TexspinClutch Bearings

BoschOxygen sensor, Gasoline injection system (diesel will follow), starter, alternator, brake system

Continental AGGasoline fuel supply system, fuel level sensor

CaparoInner structural panels

HSI AUTOStatic sealing systems (Weather Strips)

DelphiInstrument cluster

Rane Madras LimitedSteering Assembly

DensoWindshield wiper system (single motor and arm)

FAG KugelfischerRear-wheel bearing

Federal-MogulPistons, Piston rings, Spark plugs, Gaskets, Systems protection

FicosaRear-view mirrors, interior mirrors, manual and CVT shifters, washer system

FreudenbergEngine sealing

GKNDriveshafts

INAShifting elements

ITWDeltarOutside and inside door handles

Johnson ControlsSeating

MahleCamshafts, spin-on oil filters, fuel filters and air cleaners

Saint-GobainGlass

TRWBrake system

Ceekay Daikin/ValeoClutch sets

VibracousticEngine mounts

VisteonAir induction system

ZF Friedrichshafen AGChassis components, including tie rods

BehrHVAC for the luxury version

DrrLean Paint Shop

The Tata Nano is also considered to be the world's slowest Petrol Car.Alternative powerplantsWhile the Nano is driven by a petrol engine, several more-radical powerplants have been proposed but not put into production. Also, an upscale version was shown at an autoshow.

Compressed-air engineTata Motorssigned an agreement in 2007 with a French firm,Motor Development International, to produce acompressed air car Nano.While the vehicle was supposed to be able to travel approximately 200 kilometres (120mi) on $3 US of electricity to compress the air, Tata's Vice-President of Engineering Systems confirmed in late 2009 that vehicle range continues to be a problem.

Electric vehicleTata has discussed the possibility of producing an electric version,and while it showcased anelectric vehicleNano at the 2010Geneva Motor Show,no such car is currently on the market.If an EV Nano is sold it is expected to be the highly affordableelectric car,uselithium-ionbatteries, and have a range of 80 miles (130km).A Norwegian electric car specialist,Miljbil Grenland AS, has been named as a supposed partner in the project.

Bi-fuel variantThe Nano CNG emax is launched in October 2013. It can run on either gasoline or compressed natural gas. Initially, it will be sold in Delhi and parts of Maharashtra and Lucknow, where CNG is available at fuel outlets.

Tata Nano AMTTata Motors is planning to launch the Nano AMT variant to be launched in the second half of 2015. The Tata Nano AMT variant will get better quality plastic, electric power assisted steering, front power windows, newly designed instrument cluster and better upholstery on seats. It also features the open-able tailgate, which helps in adding to its luggage space. Under the bonnet is the same 2-cylinder 624cc engine that churns out a maximum power output of 36PS and a peak torque of 51Nm

European export

A Nano Europaconcept carAnupscaleNanoconcept carcalled the Europa was shown at the 2009Geneva Motor Show. Car firesThere were reports of several fire incidents involving the Nano.]The company denied those were connected to the car's design or its parts and blamed "foreign electrical equipment" found on top of the exhaust system.The company offered to retrofit the exhaust and electrical systems but refused to recall the cars.Tata extended the warranty on the car, including those already sold, from 18 months to four years in early December 2010. ReceptionThe Nano has received a tepid reception from Indian consumers. Reasons given have included that it is still too expensive compared with a motorcycle.Also it is identified as the most affordable car,whereas a secondhand car that was more expensive when new has more social cachet. The fires and other safety issues have also been nominated. Still, Tata Nano has managed to fulfill the dream of Ratan Tata due to its economic affordability. After a cap on Maruti 800 production, Tata Nano has become as a lone bystander in the range of affordable cars to common man in India.

Crash safetyIn 2014 a Nano was crashed forNCAPbyADACin Germany. Despite Tata's claim that it was expecting 4 stars, the Nano actually achieved zero stars. SalesNominal factory output is 250,000 paFY 20092010 30,000 approxFY 20102011 70,432FY 20112012 74,527FY 20122013 53,848FY 20132014 first half (April to Sept.) 10,202Awards 2010 Business Standard Motoring Indian car of the year 2010 Bloomberg UTV-Autocar car of the year 2010 Edison Awards, first place in the transportation category 2010Good Design Awards,in the category of transportation 2014 India's Most Trusted hatchback car according to theThe Brand Trust Report2014 edition.

A promise is a promise, said Rattan Tata, Chairman, Tata Motors, on 10th January, 2008, when the Nano was first displayed at the Auto Show in Delhi. The Nano project didnt grab the attention of only Indians; the entire world had their eyes glued to the worlds cheapest car. A truly Peoples Car, this time is from India. Though the dealer price is Rs. 1 lakh, the price on road, when it will be launched, will reach around Rs. 1,25,00 but it will be still more affordable and will be more eco-friendly than most other cars giving a mileage of around 23km/liters. The price of the car is such that a lot of rich and HNIs, if interested, can buy the car just by a single swipe of their credit cards.Providing a car worth rupees one lakh car was the dream of the chairman of Tata motors Mr. Rattan Tata. And with high qualified IT skills people he has shown the Indian talents to whole the world.

Idea conceived by - Rattan Tata Cost of development - 1700 crores Manufacturing cost(excluding dealer margin and taxes)- Rs 65,000 per unit Development of Design - India Time for designing the car - 4 years Team -A team of 150 engineers , everyone below age 28 Biggest hurdle - To make a car cheap car without Compromising design May western countries as well as many foreign countries have accepted Indian IT skills.

This will result into: OLD GENERATION NEW GENERATION

SWOT Analysis

STRENGTH Brand name TATA Cost price low Fuel efficient Safe

WEAKNES Low power Not a status symbol Delay in manufacturing Limited features

OPPORTUNITIES Large market for selling Awareness in the market First car in low range Can hit in global market THREATS Company rival Not sure to hit in rural and semi-urban areasNew Product Development And NanoAs seen before, A product can be considered new under the following situations:- New-to-the-world products New product lines Additions to existing product lines Improvements and revisions of existing products Repositioning Cost reductionsAs far as Nano is concerned, it falls into new to the world products in the context that it has made a history for the cheapest car ever made without compromising on quality. I.e. best way value analysis. It can also be considered as new product in the since of cost reduction as its the first time in the history that such a cheap car is produced.The story of the Nano is not confined to its impact on the auto industry. It's a tale that illuminates the India of todayan eager, ambitious nation with a combination of engineering talent, a desire for low costs and value, and the hunger of young managers looking to break from a hidebound corporate environment. Indeed, the team that worked on the Nanoon average aged between 25 and 30has helped to flatten Tata Motors' stodgy, multilayered management structure, which has resulted in an unexpected side-benefit called "organizational innovation".

Idea Generation And NanoA dream is born Says, I observed families riding on two- wheelers -- the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. Add to that the slippery roads & Night time too. It is downright dangerous. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family. So when Tata Motors needed someone to take charge of the company's most ambitious plan yet to build the world's cheapest car ever Ravi Kant, who by then had become the company's managing director, again turned to Wagh. Wagh remembers what he learned marketing the little truck. "People want to move from two-wheelers to four-wheelers," he says. "Today they can't afford it."More and more can, but Indian car buyers today represent a tiny slice of a potentially giant market India has just seven cars per 1,000 people. India's auto industry has grown an average of 12% for the past decade, but just 1.3 million passenger vehicles were sold in India in the fiscal year ending March 2006. That means a billion Indians buy about the same number of cars in a year as 300 million Americans buy in a month.If four wheels cost as little as two wheels, that could change fast. About 7 million scooters and motorcycles were sold in India last year, typically for prices between 30,000 rupees and 70,000 rupees, about $675 to $1,600. Tata is targeting a price of 100,000 rupees one lakh, in Indian terms of measurement or about $2,500 at current exchange rates, for its small car. That sounds impossibly cheap in the West but remains three times higher than India's annual per capita income. The average pay for factory workers at Tata Motors is just $5,500 a year.

Idea screeningThe next step was the screening of idea. How is this dream possible? What should they make? A scooter with two extra wheels at the back for better stability? An Auto-rickshaw with four wheels? A three wheeled car like a closed auto- rickshaw?? A four wheeled car made of Engineering Plastics? A Four wheeled rural car? Rolled up Plastic curtains in place of windows? Openings like Auto rickshaws from the side A four wheeled open car with safety side bars?But the market wanted a car and if they build a peoples car it should be a car and not something that people would say, Ah! Thats just a scooter with four wheels or an auto-rickshaw with four wheels & not really a Car. Trying to build a car cheap enough for motorcycle buyers seems to make sense now but seemed crazy several years ago when Rattan Tata, longtime chairman of Tata Motors and scion of the nation's giant Tata Group conglomerate, first mentioned his dream of building a one-lakh car in 2003. "They are still saying it can't be done," he says, insisting that it can and will. "Everybody is talking of small cars as $5,000 or $7,000. After we get done with it, there will hopefully be a new definition of low-cost."

Concept Testing And DevelopingBefore starting the project, Wagh did something no one at Tata Motors ever had: He talked to customers. The three-wheeler men inevitably insisted on a cheap, dependable truck that could go from village to market carrying, say, a ton of onions or potatoes, one night, as sunset approached, Wagh stuck with one rickshaw driver. He says, "I kept asking the question. Why? Why? Why do you want a four-wheeler?" Wagh remembered. Finally, he got the real answer. It turned out it wasn't really a problem of transportation of vegetables If I had a four-wheeler, I would have better marriage prospects in my village," the young man said. Drivers of three-wheelers are looked down upon in India. Wagh realized that four wheels had emotional, not just practical, appeal.Thus the new product was now to be developed. But what type of product? The car to cost Rs. 1 lakh on road. The car should be built on a different platform than conventional ones. It must be meeting all the safety and regulatory requirements. It has to be built on a scale which shall be more than double the earlier launches of similar products and the ramp up must be smooth. The car has to be designed so that it can be exported to other countries as the domestic demand may not materialize as per projections. The car must be a beacon for the Indian Automobile industry and prove to the world that we are capable to take any challenge and come out worthy winners.That quest to build the world's cheapest car hasn't ended. The Nano should be available this fall, but the mission began back in 2003, when Rattan Tata, chairman of Tata Motors and the $50 billion Tata conglomerate, set a challenge to build a "people's car". Tata gave an engineering team, led by 32-year-old star engineer Garish Wagh, three requirements for the new vehicle: It should be low-cost, adhere to regulatory requirements, and achieve performance targets such as fuel efficiency and acceleration capacity.The design team initially came up with a vehicle which had bars instead of doors and plastic flaps to keep out the monsoon rains. It was closer to a quadricycle than a car, and the first prototype, even a bigger engine, which boosted the power by nearly 20 per cent, was still dismal. "It was an embarrassment," says Wagh.But failure didnt stop them they quickly realized it was necessary to bring everyone on board, "else it leads to last-minute heartache and delays". Every morning, he would spend an hour or two on the floor of the Pune factory, insisting that everyone involveddesigners, manufacturing teams, and vendor development peoplebe there to accelerate decision-making and problem-solving. Over time, Wagh's team grew to comprise some 500 engineers, an impractically large group to gather on a daily basis. So instead, a core team of five engineers gathered every day at three pm to discuss the latest developments. Each engineer represented a different part of the car: engine and transmission, body, vehicle integration, safety and regulation, and industrial design. The body had to be changed because Rattan Tata, over six feet tall himself, wanted it to be easy for tall people to get in and out of the car. "Imagine the plight of the body designerhe went through hundreds of iterations, then at the last minute the car length was increased by 100 millimeters!" Wagh says. The attention to detail paid off: When the car rolled onto the dais at the Auto Show in New Delhi in January, and Rattan Tata stepped out of the driver's seat with ease, it made an immediate impact. What shook the automobile world most was the fact that the designers seem to have done the impossible: The sleek, sophisticated Nano doesn't look flimsy or inexpensive. If it had been an upgraded scooter on four wheels, Tata still would have been applauded for making a family of four safer on Indian roads. The Nano, however, affords both safety and status. "The innovation wasn't in technology; it was in a mindset change".

Business AnalysisCost Since the car had to be built within a cost of Rs. 1 Lac, no conventional design would work as the costs shall be higher and so the entire car has to be redesigned. What makes Nano so less expensive can be well understood from the following diagram

The design has to question the need of each and every component from the point of view of its necessity of existence and also the minimum requirements of its functionality. Value Engineering concepts have to be deployed to finalize the minimum requirements.

Disruptive Technology:Is a Technology that brings radical change by introducing new ways of doing things usually at a Technology that is: Significantly cheaper than existing Technology. Is much higher performing? Has greater functionality and Is more convenient to Use. Brings to market a totally different Value proposition than the one available and can change the Paradigm about a product.The Guiding factor was that the cost has to be minimized for each component yet maintaining its basic functionality. The Alternatives are: Reduce Consumption of Material being used. Alternate Suppliers to get same material at fewer prices. Use alternate materials. Eliminate use of Material. Eliminate a process Or a Combination of the above. The design was outsourced to Italy's Institute of Development in Automotive Engineering, but Tata himself ordered changes along the way. Most recently he vetoed the design of the windshield wipers. His solution: a single wiper instead of two, giving the car a cleaner look.

THE COST REDUCTION PARADIGM Value Engineering Alternatives:The target was very clearly defined that within the given cost structure of 1 Lac all the components have to be allocated a maximum price and the same had to be achieved using the available alternatives. The Guiding factor was that the tax structure, on materials and manufacturing, must support the final cost of Rs. 1 Lac. The Decisions were: Establish factory in a tax free zone. Get the tax advantages on infrastructure development. Get the suppliers to establish base near the factory. Get special concessions from State Govt. In short select a manufacturing location where all the advantages could be achieved. In short select a manufacturing location where all the advantages could be achieved.

Total sales estimationNow the question was, how much to produce It was estimated that the demand for the peoples car shall be at least twice the demand for Maruti 800, the lowest end car. Initial projections were at about 500 K cars per year. The basic reason was the conviction that the target price shall redefine the 4 - wheeler segment. The price decision of Rs 1 lakh is definitely going to make a lot many people transit to 4-wheeler fold and that shall explode the demand. F only 10% customers of 9 Million two wheeler market transit to 4-wheelers it shall amount to 50% of the passenger car market share. It was decided to set up plants with 5 lacs cars per annum capacity and ramp the same up in stages, in line with increase in market demand. The initial response to the Nano has been overwhelming and the tiny, Noddy-land car is expected to help the company cross several milestones. With revenues at Rs 1,29,994 crore for the financial year 2006-7, and group companies enjoying a market capitalization of Rs 2,51,487 crore as on January 10, 2008, the Tata Group is on a strong footing, contributing more than 3 per cent to India's GDP. Nano, being the world's cheapest car, has made international players sit up in amazement and the company has received proposals from some African, Latin American and Southeast Asian countries to manufacture the car there.

Product DevelopmentAnd finally the product was developed with the following features. Engine CapacityBosch 624 c.c. twin cylinder Low capacity, Lighter, sufficient with better Power Rear Engine to reduce the transmission length using a balancer shaft. 4 Speed Manual Gear Box All Aluminum Engine Higher thermal conductivity than cast iron, Lighter and so better mileage Engine Management System by Bosch Superb control over emission and smooth acceleration. Dimensions L: 3.1m, W: 1.5m, H: 1.6m Less length but more inner cabin space due to height. Comfortable leg room. Independent Front & Rear Suspension McPherson Strut in Front & Coil spring & trailing arm in rear. Better ride than Maruti 800. Single piece ribbed steel body with safety features such as crumple zones, intrusion resistant doors, seat belts, strong seats & anchorages. Safety requirements are adequately met. Single Wiper in place of two. Cost effective yet functionality is met Tube less Tires Weight reduced by 2 Kg. Cost reductions 200 Rs. And in line with modern vehicles Instrument console in the centre Elegant to look at and can be used both in Left Hand & Right hand version. The list goes on and on. The Final verdictTHE CAR COSTS Rs 1 lac Test Marketing And Commercialization Nano was launched in the month of April. It has been commercialized in whole of India. It is mostly targeted to the middle class and lower middle class people. The effect of Nano has seen over the period of time.

SOME MYTHS ABOUT NANOWhen Nano was introduced, it surprised everyone. It had so many features but the cost was as low as Rs. 1 lakh. This was really amazing. Due to this, many competitors, governments and others opposed Nano. Moreover, its not a new thing that whenever a new concept is developed, people oppose. They find more limitations then seeing the benefits. Following are some myths about Nano. But these are then proved to be wrong.Myth no #1

Nano is an unsafe car

The car has an all steel body. It meets the mandatory Frontal Impact requirements. It also meets the Side Impact requirements although they are not mandatory in India. Myth no #2

Nano will greatly increase the Pollution Level

The car is Bharat IV and Euro IV compliant although these norms, which are stricter than the present Bharat III norms, are yet to be introduced. It has lower carbon footprint, 20 mg / Km of Carbon Dioxide emission as compared to 45mg / Km, emitted by most of the two wheelers. Its Multi Port Fuel Injection system is controlled by an intelligent Bosch Engine Management system which controls the combustion cycle precisely to ensure compliance to all emission norms.

Myth no #3

Nano will struggle to perform

Although the car has 33 bops as the maximum horsepower it has a low kerb weight of 550 Kg and so has a higher power-to weight ratio when compared to many existing cars running on Indian roads. The car has a matching acceleration to Maruti 800 and also a good top speed. Although the manufacturers have estimated 90 Kms as the maximum speed the car can go up to 105 Kms per hour top speed.

Myth no #4

Nano has very little leg room

Although the car is 8% smaller than Maruti 800 it has lot of extra leg room at front as there is no engine compartment. This also leaves sufficient knee room at the rear. The car has a tall boy type design so there is lot of head space and also enough Shoulder room. The mono volume design and the wheels having been put at the corners have freed up lot of in- cabin space and although the car may be registered as a four-setter, three slim adults can sit comfortably at the rear.

Myth no #5

Cheap means Uncomfortable

More comfortable than some of the cars selling at even twice the price. Leaves sufficient knee room at the rear. Easy to get in & out of the car because of perfect seat height from the ground. Suspension systems are good and the trailing arms with coil springs are not found in cheap cars. Rear.

Myth no #6

Its very difficult for a rear - engine car to work.

Rear engines work in many cheap as well as expensive cars. Auto-rickshaws at one end and Formula One cars on the other extreme all use rear engines. Maruti Omni too has a rear engine, under the seat and no one has been burnt due to that. Cooling is easier in Nano as compared to some vans and there are the air ducts on either side behind the edge of the doors, which allow air to seep in for both cooling & for intake.

Myth no #7

There is a shortage of storage space.

There is some storage space although not much. The rear seat with parcel shelf folds to allow accommodating a large suitcase. Small articles can be placed under the bonnet also.

Myth no #8

Cutting Corners is evident everywhere

Cost cutting is done by smart designing rather than taking out the essentials. One wiper has been taken out but the functionality is intact. Wind shield washer fluid jets are mounted on the wiper itself rather than the body. Wheels are held by three bolts instead of four. On the contrary, MRF tubeless tyres and all Alumininium engine, have been used, which are more expensive than conventional ones.

TATA NANO V/S MARUTI 800CompetitorAs we know the price of Nano car is much affordable for middle class people. This car can be easily affordable by middle class people. In the Indian market it will face only by one competitor that is Maruti 800, which produced by Maruti udyog.The real question arise who will have the last laugh Tata or Maruti 800?The answer is neither Tata nor Maruti 800 but they are the buyers who will have the last laughCan Nano beat the popularity of Maruti 800. All the things depend on their marketing strategy that how they will attract to Indian middle class customers.Never mind the fact that what was touted as a Rs.100,000 car will cost at least a fifth more and that's for the standard non-air conditioned version. Jagdish Khattar, a former head of Maruti 800 manufacturer Maruti Udyog Ltd, says it's too early to say whether the Nano will overtake the original. "It's a good product but it's still too early to say whether it will overtake the 800 because it caters to a totally new market segment," he said while watching a live telecast of Tata's press conference after unveiling of the Nano. But clearly, at least one other manufacturer was worried. Whether or not the Nano will overtake the Maruti 800, one thing is for sure: the current Auto Expo will be remembered for Tata's people's car and for that product alone. It is the Nano that has captured the hearts and minds of a majority of the spectators.Price of Maruti in major city of India 800 (a/c LPG) (Figures in rupees)Mumbai245648

Delhi228858

Bangalore231407

Kolkata236826

Lucknow 232542

TATA NANO V/S MARUTI 800

FEATURES OF TATA NANO COMPRAED TO MARUTI 800

COST:

The dealer price of Maruti 800 varies from city to city. The dealer price in Delhi is 1.97 laths and the road price is approximately 2.28 laky Indian rupees. The dealer price of Nano is just 1.00 lakhs rupees and the road price is only 1.26 lakhs rupees. So here we can put the equation 2 * Nano = 1* Maruti 800

ENGINE:

Maruti 800: 800 cc Tata Nano :623 cc (better fuel than Maruti 800)

ENGINE TYPE:

Maruti 800 petrol/LPG Nano : petrol (diesel version will be later)SEATING CAPACITY:

Maruti 800: 4+1 person Nano: 4+1 personFUEL TANK CAPACITY:

Maruti800 : 28 Lt (petrol), 19.2 (LPG) Nano: 30 Lt.WEIGHT

Maruti 800 more than 690 kg (gross weight is 1000 kg) Nano more than 600 kgTOP SPEED:

Maruti 800 : 120 km/hr Nano : 90 km /hrSEGMENT:

Maruti 800 middle class peopleNano: lower and middle class people.

FUEL CONSUMPTION:Maruti 800: city 13.6 and highway 17.6 km Nano: city 22 km and highway 26 kmDIMENSIONS:Maruti 800Tata Nano

Length3.335 meters (131.3 inch3.1 meters

Width1.440 meters (56.7 inch)1.5 meters

Height(55.3 inches)1.6 meters

BREAKS: Maruti800: Front Disk, Rear Drum Nano: Front Disk, Rear Drum

COLOURSMaruti 800 Tata Nano:

The Nano are not much taller and broader as compared to Maruti 800 but it has 21 percent larger spaces in side but 8 percent short than Maruti.

Disadvantages of NANO vs. Maruti 800

1. LPG/CNG version is doubtful.2. Top Speed will be laser than 800.3. Space for Language is less.

4. FINANCIAL ANALYSIS OF THE COMPANY

Tata Motors was established in 1945, when the company began making trains. It has its manufacturing base in Jamshedpur, Lucknow, Pune and soon one more plant is going to established at Singur, West Bengal. Product Manufactured - Passenger Cars and commercial vehicle Installed Capacity - 350,000-400,000 vehicles a year Investment - Rs 2,500 crore (Rs 25 billion) Turnover - $21.9 billion (Rs 967,229 million) Employees - 2,46,000/22001 Tata Motors had created the wealth Rs. 320 billion during 2001-2006 and stood among top 10 wealth creators in India.

5. DATA ANALYSIS

We planned to start the analysis part by flow of question in the questionnaire 1. What do you own presently?Car|_| Bike |_| Other |_|

From the 69 respondents 26 of them owned only car which is 37.7%, 17 respondents owned only bikes, contributed to 24.6% and there were 19 such respondents who owned car as well as bikes, contributes to 27.9%, 7 respondents were there who didnt had a car or a bike, who traveled in bus or in autorikshaw or owned autorikshaw.

2. If car then, what type of car do you own?Small |_| Sedan |_| SUVs |_| Premium |_|

Type of car

FrequencyPercentValid PercentCumulative Percent

ValidSmall2130.446.746.7

Sedan1217.426.773.3

SUVs913.020.093.3

Premium11.42.295.6

small and SUVs11.42.297.8

Small and sedan11.42.2100.0

Total4565.2100.0

MissingSystem2434.8

Total69100.0

The car owners were asked to specify there car, i.e. class wise. This showed that maximum were the small car owners and contributed to 46.7% of the total.

3. If bike then, what type of bike do you own?Economic |_| Premium |_|

Type of bike

FrequencyPercentValid PercentCumulative Percent

Valideconomic1724.644.744.7

premium2130.455.3100.0

Total3855.1100.0

MissingSystem3144.9

Total69100.0

The bike owners were asked to categorize their bikes in two categories namely economic and premium.

4. In car which brand do you own? (Please specify brand model) Maruti Suzuki: ____19%_______________________ Hyundai: ________10%___________________ Tata: ____6%_______________________ Ford: __________3%_________________Other Brand: _______10%_____________

Interpretation

When the car owners were asked to specify the brand, as known Maruti holds the major market share, 19 respondents owned Maruti, 10 respondents owned Hyundi, 6 owned Tata, 3 owned Ford and 10 owned different brand cars.

\5. Do you intend to buy a car in next 1 year?Definitely will buy |_| probably will buy |_| May or may not buy |_|Probably will not buy |_| definitely will not |_|

Intend to buy a car in next 1yr

FrequencyPercentValid PercentCumulative Percent

Validdefinitely will buy913.013.013.0

probably will buy2231.931.944.9

may or may not buy1318.818.863.8

probably will not buy1014.514.578.3

def will not buy1521.721.7100.0

Total69100.0100.0

When we asked the respondents weather they will be buying a car in coming one year, we got a very mixed up response, where 13% of the respondents said thy will definitely buy a car, and 21.7% said they will not be buying a car. The rest were not sure with yhere decision.

6. Will you be interested in buying TATA NANO car? (If yes go to Q.no:7,if not go to Q.no:8)Yes |_| No |_|

Interested in buying TATA NANO

FrequencyPercentValid PercentCumulative Percent

Validyes3550.750.750.7

no3449.349.3100.0

Total69100.0100.0

A straight question, will you be buying TATA NANO, we thought that we would receive a good positive response, but to our astonishment, the response was almost 50/50.

7. What intended you to think to buy NANO in future?Price |_| mileage|_| maintenance |_| safety|_| service|_|

What intended you to buy TATA NANO

FrequencyPercentValid PercentCumulative Percent

ValidPrice1826.151.451.4

price and service57.214.365.7

price,milage,service11.42.968.6

price,milage,maintenance11.42.971.4

price,maintanance11.42.974.3

price,milage68.717.191.4

price,milage,maint,service,safety11.42.994.3

price,safety22.95.7100.0

Total3550.7100.0

MissingSystem3449.3

Total69100.0

35 respondents were willing to buy TATA NANO, and the major factor was PRICE, which inspired them to think for TATA NANO.

8. What intended you not to buy NANO? _________________________________________________________________________________________________________________________________________________________________________________________________________ Most common answers given for this question are:1) Size, Safety, and Performance- 32%2) Price and Status- 40%3) Traffic and Not need- 28%

Interpretation

The people who were not aware about TATA NANOs specifications they were saying about size, safety and performance. Persons who were from high income group were saying about price and status. The middle income group people who are qite satisfied with the public transport said I would increase traffic problem or its not needed at this point in their lif

9. What do you feel about TATA NANO will perform in the market?Highly successful|_| Successful |_| neither successful nor unsuccessful|_| Unsuccessful |_| highly unsuccessful|_|

What do you feel about TATANANO will perform in the market

FrequencyPercentValid PercentCumulative Percent

Validhighly successful1115.915.915.9

successful3347.847.863.8

neither successful nor unsuccessful2029.029.092.8

unsuccessful34.34.397.1

highly unsuccessful22.92.9100.0

Total69100.0100.0

On the success matter when we asked them 63.8% of the respondent said that TATA NANO will be a success and 7.2% said it will be unsuccessful, where as 29% of the respondent were clue less.

10. What do you perceive TATA NANO in terms of safety?Definitely will be good |_| probably will be good |_| May or may be good |_| Probably will not be good |_| definitely will not be good|_|What do fell in terms of safety

FrequencyPercentValid PercentCumulative Percent

Validdef will be good1014.514.514.5

probably will be good1927.527.542.0

may or may be good1521.721.763.8

probably will not be good1724.624.688.4

def will not be good811.611.6100.0

Total69100.0100.0

42% of the respondents had faith in Tata and said the car will be good at the safety parameters, where as 37.2% of respondents felt that it will not be good at safety parameters.

11. Do you think TATANANO will increase traffic problem?Yes |_| No |_|

Will increase traffic problem

FrequencyPercentValid PercentCumulative Percent

Validyes4768.168.168.1

no2231.931.9100.0

Total69100.0100.0

There were only 31.9% of the respondents who said it will not increase the traffic but rest of them felt that it will increase the traffic problem.

6. FINDINGS

After the study of various aspects we found that Nano Car Is Definitely Not For:- Someone looking for better performance. Someone who is looking to impress somebody. Someone who wants to speed trial on Sunday Someone who is looking for long drives.But Nano Car Is Defiantly For Someone who is looking to buy a car but cannot afford much price. A students who want to go college, tuition instead of bike etc. Someone who depends on second hand car. For a house wife who can buy a car with her own savings. Someone who depends on scooter. So Nano is not a basically a luxury cars but it can fulfilled the all capacity for middle class people.Impact Of Tata Nano On Life Of Common Man In India every one can afford a Nano, just as we buy any electronic appliances for a home uses. Decrease in price of second hand car. High traffic on roads due to sale of exceeds car on roads. Increase in loan on car installments.

7. CONCLUSION

After the study of various aspects I found that Nano Car Is Definitely Not For:-

Someone looking for better performance Someone who is looking to impress Someone who want to speed trial on Sunday Someone who is looking for long drives.But Nano Car Is Defiantly For

Someone who is looking to buy a car but cannot afford much price. A students who want to go college, tuition instead of bike etc. Someone who depends on second hand car. For a house wife who can buy a car with her own savings. Someone who depends on scooter. So Nano is not a basically a luxury cars but it can fulfilled the all capacity for middle class people.Impact Of Tata Nano On Life Of Common Man

In India every one can afford a Nano, just as we buy any electronic appliances for a home uses. Decrease in price of second hand car. High traffic on roads due to sale of exceeds car on roads. Increase in loan on car installments.

And finally Nano is definitely better than Maruti 800.tata has succeeded in value engineering of the product and its great success for tatas. Its something on which India can feel proud of. Nano has been developed effectively.

8. SUGGESTIONS

As per our findings we have some recommendations, which will be useful when TATA NANO will be introduced in the market.

Advertisement and Publicity should be done very strongly, not only by price tag but also by showing the technical specification, this will help in,

1) NANO will be visible in the market.

2) Help in converting the potential car customers to brand customers.

3) Will give strong position in the market to stand against the stronge competitor Maruti 800.

Tata has succeeded in value engineering of the product and its great success for tatas. Its something on which India can feel proud of. Nano has been developed effectively.

9. LIMITATIONS

As every research have its own limitations, so as we had and they are as follows:

1) Survey conducted in a small geographical area, in Bangalore.

2) Research conducted on the response of the 69 respondents, which cannot correctly represent the population.

10. APPENDICESQUESTIONAIREDate ___________

Dear sir/madam,We are doing a brief survey to find out more about consumers perception about TATAs new people car TATA NANO. We would be grateful if you could spare a few minutes to participate in it and we assure that this information taken will be purely used for academics purpose only. Thank you for your cooperation.

1. What do you own presently?

Car|_| Bike |_| Other|_|

2. If car then, what type of car do you own?

Small |_| Sedan |_| SUVs |_| Premium|_|

3. If bike then, what type of bike do you own?

Economic |_| Premium |_|

4. In car which brand do you own? (Please specify brand model)

Maruti Suzuki: ___________________________ Hyundai: ___________________________ Tata: ___________________________ Ford: ___________________________ Mitsubishi: ___________________________If not any of these please specify: ____________________

5. Do you intend to buy a car in next 1 year?

Definitely will buy |_| probably will buy |_| May or may not buy |_| probably will not buy |_| definitely will not |_|

6. Will you be interested in buying TATA NANO car? (If yes go to Q.no:7,if not go to Q.no:8)Yes |_| No |_| 7. What intended you to think to buy NANO in future?

Price |_| mileage|_| maintenance |_| safety|_| service|_|If others please specify _______________________________________________

8. What intended you not to buy NANO? _________________________________________________________________________________________________________________________________________________________________________________________________________

9. What do you feel about TATA NANO will perform in the market?

Highly successful|_| Successful |_| neither successful nor unsuccessful|_| Unsuccessful |_| highly unsuccessful|_|

10. What do you perceive TATA NANO in terms of safety?

Definitely will be good |_| probably will be good |_| May or may be good |_| probably will not be good |_| definitely will not be good|_|

11. Do you think TATANANO will increase traffic problem?

Yes |_| No |_|

Personal details

Name: __________________

Age: 21 - 25 |_| 26 30 |_| 31 35 |_| 36 40 |_| 41 45 |_| 46 50 |_| 51 55 |_| 56 60 |_|

Sex: Male |_| Female |_|

Occupation:

Self employed |_| Service |_| Student |_| Housewife|_|

Monthly Income: Less than 15000|_| 15000-20000 |_| 20000-25000 |_| above 25000 |_|

QUALITY MODEL

Organizational Structure

The Organization and Management Team (TATA NANO)

The management team for Tata Nano is a diverse group with strong skills in technology,marketing and sales, finance and operations. Our primary criteria when filling these executivepositions was extraordinary past achievement.

Key Players

John Smith CEOMr. Smith brings more than 25 years of marketing and executive management expertise ingrowing businesses at leading companies. Immediately prior to Tata Nano Mr. Smith was CEOof New One Corporation. While there he led the worldwide widget marketing group, a multibilliondollar enterprise that is currently ranked first in its industry. Mr. Smith also successfullyreorganized the company, streamlining operations and improving profitability.Mr. Smith had previously spent seven years at Future, Inc. as COO. He was responsible for thedevelopment and launch of numerous successful products in growing markets and newbusiness categories for Future. He helped drive revenues from more than $3 billion to morethan $12 billion. Under his guidance, the company was named the most-respected brandnames in America in 1996 and 1997. He holds both a Bachelor of Science in IndustrialEngineering and a Bachelor of Science in Management from Northwestern.

Fred Stone COOFred Stone was brought in a COO in January 2008. As COO, Mr. Stones mission is to establishTata Nanos leadership in the worldwide market. Mr. Stone was most recently senior vicepresident of the global customer service organization at Gravel, Inc. His responsibilities includedcustomer service for all of Gravels Large Boulder Operations. Prior to his worldwide servicerole, Mr. Stone was responsible for Gravels worldwide Enterprise Sales and Serviceorganization.Mr. Stone has held a variety of sales and marketing management positions at including vicepresident of Gravels North America System Sales, vice president and general manager forGravels boulder networking product group, and a director of marketing with responsibility forkey gravel product lines.TATA Nano 4Mr. Stone holds an MBA from the University of North Carolina at Chapel Hill and a degree inBusiness, with honors, from Michigan State University.Bob White VP of Product DevelopmentBob White was named to the Tata Nano, Inc. executive team in August 2007, as VP of BusinessDevelopment. A 13-year veteran of SIMs Corporation, Mr. White was most recently chiefsoftware engineer with SIMs' global development team. Prior to his worldwide developmentrole, Mr. White was responsible for SIMs worldwide business development group.He has held a variety of engineering management positions other Fortune 500 companies,including vice president of development at North America Car Sales with responsibility for keynetwork communication product lines.Mr. White do holds an MBA from the University of California at Berkeley and a degree inBusiness, with honors, from San Jose State University.Kate Brown VP of MarketingKate Brown is Tata Nanos VP of Marketing. She joined after nine years at OFFON, Inc., whereshe served most recently as Senior Marketing Director. At OFFON, she was responsible forcreating new strategic partnerships and also for creating a brand awareness for a $500 millionjoint venture between Act, 1business, and others.Previously, she served as Vice President at JKL, managing regional business development,marketing and sales teams. Brown also did marketing and consulting for BBB and DDEconsulting.Brown holds an MBA degree from the Duke University.Johan Bill VP of FinanceJohan Bill joined Tata Nano, Inc. as Vice President of Finance in September 2008. He managesthe company's finances and has established the financial systems. He worked with his formeremployer, Wings, for over 12 years, holding numerous executive finance management positionsas Wings grew from a $200 million to a $2 billion company. Most recently working as Controllerof Wings, he was an integral player in executing and integrating numerous acquisitions. He alsospearheaded the development of the cash management and capital infrastructure, andstreamlined the financial planning process which led to significant improvements in the internalsystems architecture.5 TATA NanoMr. Bill has a diverse financial background, with experience at both start-up and largecorporations. He graduated Summa Cum Laude from Berkley with a degree in Accounting. Healso holds an MBA from Santa Clara University.The relationship between the Board, the Committees and the senior management functions isillustrated below:TATA Nano 6Staffing CostsTitle Salary Benefits*CEO 228,000 273,600COO 180,000 216,000VP of Product Development 100,000 120,000VP Marketing 80,000 96,000VP Finance 100,000 120,000Management Committee 40,200 - 51,200 48,240 - 61,440Engineering Committee 40,200 - 51,200 48,240 - 61,440Finance Committee 40,200 - 51,200 48,240 - 61,440Sales Committee 46,000 - 56,000 55,200 - 67,200Operation Committee 19,400 - 22,400 23,280 - 26,880Total 874,000 - 920,000 1,048,800 - 1,104,000(* 20% added for employee benefits)(These are salary levels where we will be at the end of year one.)7 TATA NanoThe Revenue ModelThe way Tata Nano raise funds include several aspects. Those aspects are detailed in the asfollows.Selling the cars to clientsThis activity is the first revenue flow of the project. The first targeted market is the Indian one.The cars deliveries have started in July 2009. There are also project to extend the market toMalaysia, the rest of Asia, Europe, Africa and south America, starting in 2011.Bank ServicesTata Nano have sign contract with Indian Banks in order to allow low income people to getloans at low interests. Therefore, they could afford booking for their Tata Nano. In thatcontract, Tata Nano and the bank all take advantages.Maintenance ServicesThe Tata Nano project include a maintenance department. In fact, the customers will be offeredmaintenance services at a fix price per month. Those services will be extremely competitiveand cheap as the car itself.AdvertisingTata nano have been making a lot of advertisement in a lot of countries. As Tata Nano havebecome a famous trade, some channel will allow Tata Nano advertisement to be displayed,increasing the channel audience. In addition, Tata Motors will take advantage of sweepstakesorganized in order to promote the car. Those events always bring to the company bothpublicity and money.MarchandisingThere are a lot of product that have been manufactured in order to promote the Tata Nano,namely hats and cups. The company will therefore sell those product and make moneybenefits from them.Making franchisesThe development of Tata Nano started 6 years ago and have lead to the production of anextremely efficient car as far as pollution and gas consumption are concerned . The technologyused could be sold to other companies as Licenses, leading to funds raise.TATA Nano 8Distributors In addition, Tata Nano have planned to use Distributors to make its product easilyavailable to the Indian population. Therefore those distributors will pay royalties