BIG

Nitin Banka
FLOW OF PRESENTATION

 Overview
 Introduction
 Need and Development of ACE
 Key Issues
 Functional Strategy
 Financial Strategy
 Operational Strategy
 Marketing Strategy Competitors
 Recommendations
HISTORY OF TATA MOTORS
 1945 – Tata Engineering and & Locomotive
Company Ltd. (TELCO) was established
 1954 – Start Manufacturing commercial
vehicles
 1961 – Exporting Trucks
 1966 – Machine tools division in Pune
 1983 – Start Producing Heavy Commercial
vehicle
 1986 – Light Commercial Vehicle, TATA 407
Contd…
 1994 – Launch Multi-utility vehicle,

TATA Sumo
 1998 – India’s first Utility Vehicle,
TATA Safari
 1998 – Launch of Indica
 2005 --- Launch of TATA ACE
 2008 – Launch of TATA NANO
KEY ISSUES OF CASE
 Was there really a need to introduce TATA Ace?
 Was TATA Motors justified in indigenously
developing a new vehicle instead of
buying/licencing technology from already
established vehicle manufacturer
 Was Tata ace justified to be launched as a last
mile distribution vehicle?
INNOVATION SUMMARY

 Context
 Due to pradhan mantri gramin sadak yojana , Road
connectivity is expected to greatly improve in rural areas
 It is envisaged that higher tonnages vehicles will be not
allowed in cities
 In both the cases, all last mile distributing will be covered
by large vehicles
 The exciting production in this category is cumbersome ,
coupled with safety, pollution & comfort etc.. issues
 Challenge
 Challenge was create 4 wheeler at the cost of 3 wheeler
that would create paradigm shift in movement of goods
 The vehicle should be useful in urban as well as rural
area
 Vehicle should have good maneuverability to get through
small balances
INNOVATION
 Develop a 4 wheeler to cater a gap in the market for
goods haulages vehicles in sub 1 tone
 ACE comes at a nominal premium of 3 wheeler has like
car features & runs on diesel.
INNOVATION SCORECARD
 Uniqueness
 Create a completely new segment ;segment grew by 9%
 ACE is the only environment friendly vehicle in this
category
 Complies with the 4 wheeler safety norms
 Versatility: both in rural & urban
 Comfort : Protected cabin & larger wheel
 Safety :Only its classes to have crash test
 Impact
 Reduce pollutants as compared to 3 wheeler from 21 %
to 40%
 The product has created a new segment which
contributed 15 % companies volume in 1st year
Contd..
 Less refueling, more trips

 Leverage
 In the first year of its operation vehicle has over shouted
volume by its 200%. The planned payback period
comedown by 100%.
 Created a new reference in commercial vehicle segment
LICENSING TECHNOLOGY
 Costly Expenditure
 Create Competitors
 Legal Constraints
 Lose Position In The Market
Strategies
 Financial
 Operational
 Marketing
Financial strategy
 Lost Cost strategy initiatives
 Outsourcing
 Manufacturing
 Tooling
 Marketing
 Cost Reduction – Direct material cost, Variable
 conversion cost, Fixed Cost, interest cost
 reduction
 Break even point low
Operation strategies

 Project CUB!!
 Heavy truck & last mile distribution vehicle
 Features important for customers
 E- sourcing
 New manufacturing plant at Pantnagar
 Various strategies
 Value engineering
Operation strategies
 Engine modification
 Dealership & service
  TATA ACE Bharat Stage II and III
 ENGINE
 Model : TATA 275 IDI NA BS-II (and BS-III)
 Type : 4-stroke, naturally aspirated, indirect injection diesel engine Max.
Output : 16 hp @ 3200 rpm Max. Torque : 3.8 mkg @ 2000 rpm
Displacement : 700 cc Special Items : catalytic converter (only in BS III)
 CLUTCH : Single plate dry friction diaphragm type
 GEAR BOX : GBS 65-4/5.27 Type : Synchromesh (4 forward gears), Sliding
mesh (reverse gear)
 STEERING : Mechanical, variable ratio (20.5 to 24.5), 380 mm dia
 BRAKES Type : Dual circuit hydraulically activated Front : Disc brakes
Rear : Drum brakes (200 mm dia x 30 mm) Parking Brake : Cable operated
mechanical linkages acting on rear wheels
  TATA ACE Bharat Stage II and III
 SUSPENSION Type : Parabolic leaf spring suspension at both front and
rear Shock absorber : Hydraulic double-acting telescopic type both at front
and rear
 WHEELS AND TYRES Tyres 145R12 LT 8PR RADIAL FUEL TANK
Capacity 30 liters
 PERFORMANCE Max. Speed : 64 kmph Max. Gradeability : 16% Grade
restartability : 15%
 DIMENSIONS All in mm
 Overall Length (A) : 3800 Width : 1500 Wheel base (D) : 2100 Overall
height © : 1820 Track Front (E) : 1300 Track Rear (F) : 1320 Min Turning
Circle Dia : 8.6 m
 WEIGHTS Max. GVW : 1550 kg Kerb weight : 805 kg Seating capacity :
Driver + 1
Marketing ACE !!
 Value proposition
 Pricing strategy
 Positioning: sub -one ton pay load segment
 Distribution:
 South India
 Export
 Promotional strategies :
 Chota Haathi,
 Life Ban Jayegi Pyaare
Value enhancers……
 Looked and performed better than the
 existing alternatives.
 Addressed the key concern of
 commercial vehicle buyers : Lead &
 Load
Impact of ACE on Tata Motors
Leveraged the First Mover’s Advantage
Recommendations
Cost down efforts
 Focus on quality in process/design
 Focus on distribution network
(channel partners)
Learning's

 Balance between quality, cost and time.

 Stretch targets and motivate the
 team to achieve the desired objectives
 Set a common goal and a objective
QUESTIONS??