Beruflich Dokumente
Kultur Dokumente
SUBMITTED BY: Name:Rachita Jain Course:B.Com (Hons.) Class: III year Section I Roll no.: 314 Year: 2010- 11 Signature:
Signature:
(Mr. R. P. Rustagi)
1|Page
DECLARATION
I hereby declare that my project report on TATA Nano is an authentic work carried out by me under the guidance of Ms. Renu Agarwal under the partial fulfillment of the degree of B. Com (Honours) and has not been submitted anywhere else for the award of any other degree or diploma. I have mentioned the source of information wherever required.
Rachita Jain
2|Page
ACKNOWLEDGEMENTS
I owe a great many thanks to a great many people who helped and supported me during the compilation of this project. I extend my deepest gratitude to Mr. R. P. Rustagi, my Mentor for the project, for guiding and correcting various documents of mine with attention and care. He has taken pain to go through the project and to make necessary corrections as and when needed. I express my thanks to the Principal of Shri Ram College of Commerce for extending his support. Thanks and appreciation to Ms. Akriti Bhargava for her help and cooperation in completing and organizing the survey on Twitter. She is working with the One Learn on Twitter. I would also thank my Institution and my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well wishers.
Rachita Jain
3|Page
CONTENTS
Serial Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Topic
Industry Analysis- Automobile Industry in India TATA Motors TATA Nano- Introduction Features of TATA Nano Versions of TATA Nano What makes the TATA Nano so cheap The Controversies and The Concerns The making of TATA Nano- In brief Launch of TATA Nano Comments about TATA Nano Effects of launch of TATA Nano SWOT Analysis Questionnaire Results Conclusion Bibliography Appendix
4|Page
5|Page
275,040
353,703
391,083
519,982
549,006
417,126
566,608
356,223
374,445
434,423
556,126
500,660
501,030
619,093
5,622,741 7,243,564
6,529,829 8,467,853
7,608,697 9,743,503
8,466,666 11,087,997
8,026,681 10,853,930
8,418,626 11,175,479
10,512,899 14,049,830
17,432
29,940
40,600
49,537
58,994
42,673
45,007
68,144
66,795
76,881
143,896
141,225
148,074
173,282
265,052 479,919
366,407 629,544
513,169 806,222
619,644 1,011,529
819,713 1,238,333
1,004,174 1,530,660
1,140,184 1,804,619
SOURCE: SIAM (SOCIETY OF INDIAN AUTOMOBILE MANUFACTURERS ISO 9001-2008 CERTIFIED ORGANISATION)
6|Page
TATA MOTORS
Tata Motors is India's largest automobile company, with revenues of US$ 8.8 billion in 2007-08. Through subsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand and Spain, besides India. Among them are Jaguar Land Rover, and an industrial joint venture with Fiat in India. With over 4 million Tata vehicles plying in India, Tata Motors is the countrys market leader in commercial vehicles and among the top three in passenger vehicles. It is also the world's fourth largest truck manufacturer and the second largest bus manufacturer. Tata cars, buses and trucks are being marketed in several countries in Europe, Africa, the Middle East, South Asia, South East Asia and South America.
7|Page
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. said Mr Ratan Tata, the chairman of Tata Motors, who laid the foundation for creation of the Worlds cheapest ca r. Providing a car worth rupees one lakh was the dream of the chairman of Tata Motors, Mr. Ratan Tata. And with high qualified IT skills he has shown the Indian talent to the whole world.
8|Page
OLD GENER
ION
NEW GENER
ION
The advent of Nano represents a vi tory for those who advocate making cheap goods for potential customers at the "bottom of the pyramid" in emerging markets. Most of all it gave millions of people, now relegated to lesser means of transportation the , chance to drive cars. The project has literally become India's claim -for-fame in the international-media due to Tata Motors' innovation in developing the car, as well as keeping it low in price. The car itself is expected to boost the Indian Economy, create entrepreneurial-opportunities across India, as well as expand the Indian car market by 65%.
9|Page
Length Width Height Engine Capacity Power Fuel Injection Fuel Type Body Type Seating Capacity Mileage
3.1 metres 1.5 metres 1.6 meters All-aluminium, Rear Mounted, Rear Wheel Drive 623 cc 33 PS Multi Point Fuel Injection (MPFI) Petrol, Diesel Version will be later Sheet Metal 04 (Four) 20-22 Kmpl (City drive) 26 Kmpl (Highways)
75 K.M Euro-IV, Bharat Stage-III compliant Frontal Crash Tested One Standard and Two Deluxe
10 | P a g e
VE
O T T NANO
Tata Nano Standard Tata Nano Diesel Standard Tata Nano Deluxe Tata Nano Diesel Deluxe Tata Nano Luxury Tata Nano Diesel Luxury
TATA NANO L X
11 | P a g e
12 | P a g e
THE SINGUR CONTROVERSY LOCATION OF SINGUR: Singur is a census town in Hooghly district in the Indian state of West Bengal. Singur railway station is 34 km from Howrah Station on the Howrah-Tarakeswar line. It is 2 km ahead of Kamarkundu junction, the crossing point of HowrahBardhaman chord and Howrah-Tarakeshwar lines. It is on the Durgapur Expressway/ NH 2. WHY SINGUR? For a long time many of us used to wonder as to what made Mr. Tata choose West Bengal in the first place. Lets take a look at some of the incentives offered by the West Bengal government to the Tata Motors: 1. Rs 200 crore loan to Tata Motors at 1 percent interest per annum, repayable in five equal annual installments starting from the 21st year of the date of disbursement of loan. This loan was released within 60 days of the signing of the agreement. 2. Power for the project was to be supplied at Rs 3 per KwH, as against the going rate of around Rs 4.15 per KwH. In the case of a more than 25 paise per KwH increase in tariff in every block of five years, the government would provide relief through additional compensation to neutralize the additional increase. In effect, therefore, the project would have continued to get power at Rs 3 per KwH, irrespective of the market rates. 3. The WB Government had also agreed to provide 645.67 acres to Tata Motors on a 90-year lease on an annual rent of just Rs 1 crore for the first five years and with an increase at the rate of 25 per cent every five years till 30 years. After 30 years, the rent would have been fixed at Rs 5 crore a year with an
13 | P a g e
increase at the rate of 30 per cent after every 10 years till the 60th year. After that the rent was to be Rs 20 crore a year. 4. Now, coming to fiscal incentives, the WB Government had agreed to provide excise exemption for the first 10 years and 100 per cent income tax exemption for the first five years and 30 per cent for the next five years, on par with the incentives offered by Uttarakhand.
THE CONTROVERSY: Tata Motors has been occupying the headlines more for the Singur controversy than for the Nano. Singur car factory land dispute arose as Tata's planned manufacturing unit for the car in Singur, where the state government of West Bengal had allocated 997 acres to Tata Motors. The construction for this factory on which the Nano was supposed to be coming up started in the month of July 2007 but soon faced opposition from a political party. The Trinamool Congress, led by Mamata Bannerjee, protested against the manufacture of the car and the plant saying that the land was to be used for agrarian purposes and was wrongfully allotted to Tata Motors for making the Nano. There were protests all over the state and even in the capital city of New Delhi. Activists of the Trinamool Congress stood outside the main gate of the plant and protested against any work in the plant. For completing their Nano project in West Bengal the Tata motors had invested a lot of money and if they shifted their plant from West Bengal to other states then they would have to bear a loss of approximately 1000 crore rupees . This is because they had assembled their machinery in Singur plant for manufacturing the Nano car.
14 | P a g e
But due to continued agitation, Tata Sons chairman Mr. Ratan Tata on 2nd October, 2008 officially announced that Tata Motors would be pulling out of Singur for the security of their officers was of paramount importance to them and the states of Karnataka, Maharashtra as well as Gujarat were being looked at as viable options for the setting up of the Tata motors factory. Finally Gujarat was taken up as the apt place for building a new factory. West Bengals loss turned out to be Gujarats gain. Ratan Tata was quoted saying in a paper, whether the people of West Bengal wanted jobs or lawlessness. Pranab Mukherjee the external affairs minister of the country had said that if a group like Tata motors exited the state of west Bengal it would be a great setback for them and the industrialization of the state. But the controversy, though financially is backbreaking, it hasnt diluted the brand Nano. In fact, it has made Nano a huge brand even before its launch. In every article on Singur, the Tata Nano model is invariably mentioned. Nano was covered extensively by world media when it was launched and except for one-full page advertisement Tata did not spend on advertising for Nano at all. Yet, Nano is a household name today, thanks to the controversy and the Analysts estimate that the buzz created by the free publicity for Nano is worth over Rs 500 crores. In fact what we feel is that Nano is on everyones mind but the production has been hampered by this controversy. The new facilities are not yet ready which will lead to delays in time schedules. Adding to this, the waiting list is very long and increasing rapidly. Failure of order delivery on time will create disappointments all around. Also, the losses of over Rs 500 crores will surely put pressures to keep the price at Rs 1 lakh. The price will not be sustainable and there will be likely price hikes following the introductory offers.
15 | P a g e
POLLUTION AND SAFETY CONCERNS Critics of the car have questioned its safety in India (where reportedly 90,000 people are killed in road-accidents every year), and have also criticized the pollution that it would cause. They fear that the car will increase the number of cars in Indian roads significantly and thus the amount of emission will be increased as well as accelerating the global warming. Tatas competitors are not that much satisfied with the launch of their new product indicating its safety concern. Nano is Bharat III and Euro IV complaint. It has lower carbon footprint, 20 mg / Km of Carbon Dioxide emission as compared to 45mg / Km, emitted by most of the two wheelers. The high fuel efficiency (20 km/litre) also ensures that the car has low carbon dioxide emissions, thereby providing the twin benefits of an affordable transportation solution with a low carbon footprint. Tata has also said that Nano has an all sheet-metal body, with safety features such as crumple zones, intrusion-resistant doors, seat-belts, strong seats and anchorages, tubeless tyres and the rear tailgate glass bonded to the body. It meets the frontal impact requirement and also the side impact requirement (although they are not mandatory in India).
16 | P a g e
17 | P a g e
May 2008: Supreme Court refuses to stay Nano roll-out from Singur June 2008: Singur protesters break factory gate Aug 2008: Talks between West Bengal Chief Minister Buddhadeb Bhattacharjee and Mamata Banerjee, who demanded return of 400 acres to farmers, fail. Subsequently, Ratan Tata threatens to exit from Singur. It was followed by Trinamool Congress indefinite dharna. Factory workers stay away from work after assault. Sep 2008: WB Governor Gopal Krishna Gandhi intervenes. Agreement signed between state government and Trinamool Congress but it is shortlived. Mamata Banerjee holds rally demanding return of 300 acres of land. Security guards at Singur factory attacked. Oct 2008: Ratan Tata formally announces pulling out of Nano plant from Singur and days later declares Sanand at Gujarat as the new manufacturing location for Nano at an investment of Rs 2,000 crore Feb 2009: Tata Motors announces launch date of Nano to be March 23. Mar 2009: Ratan Tata unveils European version of Nano with added features and complying with Euro V emission norms at the Geneva Motor Show; Nano makes commercial debut. Mar 2009: Tata Motors launches the Nano in India.
18 | P a g e
"I made a promise and I kept that promise," Ratan Tata, chairman of Tata Motors, said at a glitzy launch party Monday, March 23, 2009. "I dedicate this car to the youth of India who designed it and will use it to transport their families. It shows that nothing is really impossible if you set your mind to it." Tata Nano is an amazing innovation, perhaps the best automobile innovation of 2009. To pack an entire car for such a rock bottom price is next to impossible for any car company in today's marketplace. Tata has started something that will overhaul the small car industry. If Tata Nano is a wild success, if the owners love the new car, if the car lives up not only to its looks but also on important metrics such as safety, ride, handling, fuel economy, and quality, and if Tata is able to create the Nanos in hordes to satisfy the appetite and dreams of the Indian buyers - well, we may be witnessing the beginning of at least a $1 billion enterprise in the making. People are so happy with the Nano launch that they just cannot stop talking about it. Nano bookings have now opened and just in one day the small wonder car received over 650 bookings across various Tata dealerships in Bangalore. On the first day itself a huge crowd gathered near the Tata showrooms in the city and dealerships were buzzing with potential Nano buyers. The queue to buy the worlds cheapest car was growing throughout the car as more and more people joined the mob including citys IT professionals, bus drivers, and auto drivers. To your surprise many of the dealerships also experienced bookings from first time car buyers. And this was what Ratan Tata dreamt for when he saw the vision of producing an ultra-cheap car. Scores of people have made booking for the standard and the top-end variant of the Tata Nano. Most interesting experience for the dealership was that many of the buyers are personally financing the full cost of the car and only a few are opting for a car loan. To ease the finance needs of these people Tata Motors Finance is offering a 1005 loan amount at an interest rate of 12-13% with for a period of 3 years.
19 | P a g e
The booking of Nano was closed on April 25, 2009. After the closure of the booking, selection was made through a random computerized process in which 100000 applicants were selected who would buy the Nano in the first phase.
20 | P a g e
STP ANALYSIS
Tata Motors has identified a distinctive strategic position for itself in the small-car industry, segmenting the market by end-user. The Nano will target two-wheeler and three-wheeler users, and also woo individuals looking for a second car and second hand car.
SEGMENTATION
As far as the geographic segmentation is concerned, all of India will be the target market. Mainly the semi-rural and semi-urban areas will be targeted. There is also a plan to segment the market on the basis of income levels for demographic classification. For the psychographic segmentation, personality type of people will be considered. Actually, Tata Nano is going to create a new market segment in Indian market. It is expected to lessen the difference in price level between two wheelers and four wheelers. So, industry analysts are thinking that the market of two wheelers will be affected with the advent of Tata Nano.
TARGETING
y
Geographic - the main target audience will be people living in the Tier 2 (which includes 3800 cities & towns), Tier 3 (around 597 districts) areas.
Demographic - Lowest 60% of people (income-wise) account for 33.4% of total expenditure in India and it is this group that will be planned to tap.
Psychographic - The Aspirers (Having income Rs.90000-Rs.200000) account for 21.9% of Indian households and Seekers (Having income Rs. 200000Rs.500000) account for 4.8%. 47% of aspirers and 70% of seekers own twowheeler and the plans are to persuade them to upgrade to Car.
21 | P a g e
Urban
15
20
11
66.3
50.2
31.5
11.3
3.6
Rural
Households in millions Two wheeler ownership % of tier
Tier 1
Top 4% 6 43.1
Tier 2
Next 10% 8 24.6
Tier 3
Next 35% 15 8.3
Tier 4
Last 50% 20 2.2
Why would a person owning two-wheeler buy Tata Nano? With a Rs 30,000 down payment, one can take a loan of around Rs 1 lakh and EMI works out to be around Rs 3,716 per month. With just Rs 3,700 per month on an EMI, anybody can afford this product. As far as the shift is concerned, initial estimates is around 10% of the two-wheeler market can actually shift towards the small car. How will Tata Nano affect used car market? What is felt is that used car market wont be affected initially as people who want to buy a second hand car wont have the patience to wait. Already the production has been delayed due to various reasons so the waiting period is bound to increase. But as the production facilities are utilized to maximum capacity, the waiting period will come down and it is at that time, I feel, the second hand car market will be affected.
22 | P a g e
POSITIONING 1. SMALL CAR WITH BIG DREAMS 2. MANZIL KI ORE PEHLA KADAM POP & POD Points of Parity (POP) Safety features For Luxury variant - Features like Power windows, AC , Power steering will be available Well designed Car available in attractive colors. Fuel Efficiency Points of Difference (POD) Affordability (Purchase & Maintenance of the car)
23 | P a g e
"It's a good historic moment for the Indian auto industry and also a proud one indeed that an Indian company took a step forward on this road. Its an up gradation for an auto wheeler rider to by a car now. - Rajesh Jejurikar, Managing Director, Mahindra and Renault's.
"It's 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. - Jagdish Khattar, Former MD of Maruti Udyog Limited
"Meeting the proper quality standards and safety is not feasible at all in such a model. - Andreas Prinz, Managing Director (Passenger Cars), Volkswagen Group Sales India.
"I think it is a great thing for India because mobility is giving new opportunities. I hope Tata drives to great success with the Rs one lakh car, but it is not included in our plan. - Thomas Kuehl, Board Member, Skoda Auto India.
24 | P a g e
AWARDS
y y y
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
IN THE MEDIA
"Small Wonder: The Making of Nano", is a book on creation of Tata Nano.
25 | P a g e
QUESTIONNAIRE RESULTS
The questionnaire is given in Appendix A. 50 respondents were interviewed. The questionnaire was basically developed to understand how people perceive Tata Nano, so that suitable marketing communications strategies could be developed. The following observations were made and conclusions drawn from them:
AGE
7% 6%
7%
18 - 25
26 - 40 41 - 50 80% 50 +
This chart shows that most of the respondents were in the age group of 18 to 25 years.
26 | P a g e
INCOME
80
Most of the respondents were in the income group of less than 1,50,000. This isthe main for Tata Nano.
27 | P a g e
YES NO 90%
This shows that word of mouth publicity is already in progress for Tata Nano.
PREFERENCE
0% 20% 33%
47%
Since most of the respondents were young and within the income group of less than 1,50,000, the maximum response for preference was for Tata Nano.
28 | P a g e
Prestige
PRES IGE
3% 13%
10%
14%
1 - Very Bad 2 - Bad
3 - Neutral
60%
Safety
SAFE Y
10% 10%
20% 1 - Very Bad
2 - Bad 50%
10%
3 - Neutral
4 - Good 5 - Very Good
29 | P a g e
Economy
ECONOMY
0% 3% 0% 7% 1 - ery Bad 2 - Bad 3 - Neutral
5 - ery Good
amily car
FAMI Y CAR
3% 7%
7% 23%
1 - ery Bad 2 - Bad
Tata Nano was perceived as a neutral when it comes to being called a family car by 60% of the respondents.
30 | P a g e
60%
4 - Good
90%
4 - Good
7%
33%
5 - Very Good
The Brand TATA is perceived to be good and neutral by most of the respondents.
31 | P a g e
SWOT ANALYSIS
STRENGTHS: 41 Patents for innovation Low- priced Stylish Environment- friendly High fuel efficiency Spacious- Internal space 21% more than Maruti 800 and External space 8% less than Maruti 800 Variometric gear system- magnifies torque WEAKNESSES: Less boot space No headlight levelers Not fit for hilly terrain Poor traction control Poor engine cooling and hence over heating Small tyres Windows wind down by hand
THREATS: New competitors- Bajaj, Chery, Honda Siel, GM Electric car- REVA Traffic congestion Reducing parking space Strict European Safety standards Rising cost of raw materials Rise in taxes
32 | P a g e
CONCLUSION
Tata hopes the Nano will help millions of poor people around the world the Bottom of the Pyramid in developing world marketing-speak switch from two wheels to four. Environmentalists, city planners and even some competitors, on the other hand, warn that the new vehicle will clog up Indias crowded roads and add clouds of pollution to its already filthy air. Tata emphasized that the new car complies with Indias emissions laws and even with Europes much stronger Euro 4 standards. Emissions, Tata says, are lower than a scooters today. The company claims the car will also deliver 50 miles per gallon, or better than 20 kilometers per liter, which would make it one of Indias most efficient vehicles, and vastly more efficient than the average in the U.S. After the study of various aspects I found that NANO IS DEFINITELY NOT FOR: Someone looking for great performance. Someone looking for social prestige. Someone looking for speed. Someone looking for long hours of drive. BUT IT IS DEFINITELY FOR: Someone who is looking to buy a car but cannot afford one A student who wants to go to college in his own car. Someone who depends on second hand car. A house wife who can buy a car with her own savings. Someone who depends on two-wheeler.
So TATA NANO is basically NOT a LUXURY CAR but it can fulfill the needs of the lower and the middle class people.
33 | P a g e
BIBLIOGRAPHY
Websites http://tatanano.inservices.tatamotors.com/tatamotors/ http://economictimes.indiatimes.com/articleshow/2694186.cms http://www.businessweek.com/innovate/content/feb2008/id20080227_377233. htm "Nanomania overwhelms Indian car market". Autocar.co.uk (2008-02-07) http://tatananoindia.blogspot.com/ http://en.wikipedia.org/wiki/Tata_Nano http://en.wikipedia.org/wiki/automobile industry in India www.carazoo.com www.siam.com www.edmunds.com India Today magazine India One News TATA Nano prospectus
34 | P a g e
APPENDI
Questionnaire for the primary research conducted: 1. Name 2. Age a. 18 25 years b. 26 40 years c. 41 50 years d. 50 + 3. Income Level per Annum a. Less than 1,50,000 b. 1,50,000 2,50,000 c. 2,50,000 5,00,000 d. More than 5,00,000 4. Contact Number 5. Do you know about the various features of Tata Nano? a. Yes b. No
35 | P a g e
6. What do you prefer from the following options? a. Neither a two wheeler nor a four wheeler b. A two wheeler c. Tata Nano d. Four wheeler other than Tata Nano 7. Rate Tata Nano on the given scale for the following attributes. (1 Very Bad, 2 Bad, 3 Neutral, 4 Good, 5 Very Good) a. Prestige b. Safety c. Economy d. Family Car e. The Brand TATA
36 | P a g e