Professional Documents
Culture Documents
TERM PAPER
ON
NEW PRODUCT DEVELOPMENT
FOR TATA NANO
“A SURVEY IN KOTA”
Submitted in partial fulfillment for the award of
Degree of
Master of Business Administration, 1st Semester
(2010-2012)
ACKNOWLEDGEMENT
I take this opportunity to express my indebtedness and convey my sincere thanks and gratitude to all
those who have directly or indirectly helped and contributed towards the completion of this project.
First and foremost, I would like to thank my supervisor and head of Department,Department of
Management Studies, J.N.V.University,jodhpur, for providing me this opportunity. I would also like to
thank Harish Verma sir for giving me guidelines in my project report.
Last but least, I would like to thank all the respondents who invested their valuable time in my study and
my family and friends for their valuable suggestions and cooperation in doing the work on this term
paper.
Rahul Sharma
MBA Semester
1
CHEPTER SCHEME:
1) Introduction
• meaning of product
• new product development
2) Research Objectives
3) Research Methedology
4) Stages of new product development.
5) Introduction of Tata Nano
• Company profile
• Expansion
• Aquisition
4) Tata Nano And New Product Development
5) Some Myth of Tata Nano
6) Comparaison Between Tata Nano And Maruti 800
9) Ananlysis of Data Collection
10) Various Charts
11) Some Feedback About Tata Nano
• Positive response
• Negetive response
• Mixed response
12) Conclusion
13) Bibliography/ References
Meaning of product:
Meaning of new product:- Eg. Milk , computer , shoes, service after sales, railways
services etc. a product can be divided in to two different categories.
• Tangeble product
• Intangeble product
Tangible products are known as goods that can be touched, felt, seen. Eg. Computer,
mobile phone etc.
Intangible products are known as services that can not be touched, seen as the customer
can feel and experience only after utilyzing it Eg. Services after sales.
In business and engineering, new product development (NPD) is the term used to describe the complete
process of bringing a new product or service to market. There are two parallel paths involved in the NPD
process: one involves the idea generation, product design, and detail engineering; the other involves
market research and marketing analysis. Companies typically see new product development as the first
stage in generating and commercializing new products within the overall strategic process of product life
cycle management used to maintain or grow their market share.
But let’s start with a definition. Our definition of NPD starts with the identification of an opportunity in
the market (“somebody needs a product to do this”) and ends with the successful launch of the
product.Every company must develop new products. New-product development shapes the company’s
future. The dynamics of markets, technology, and competition have brought changes to virtually every
market sector and have made new product development one of the most powerful business activities. The
monumental changes that constantly impact commerce have forced companies to innovate with increasing
speed, efficiency, and quality. In turn, this has made new product development one of the most complex
and difficult business functions. However, firms must innovate in order to survive. The power of
innovation is revealed in numerous studies, which show that companies leading their industries attribute
about half of their revenues to products developed in the most recent five years. By comparison,
companies at the bottom of their industries achieve approximately one-tenth of their sales from new
products. A firm's new product development efforts are shaped by its size, as well as the nature of the
industry in which it operates. New products may be defined as any product, service, or idea not currently
made or marketed by a company, or which the consumer may perceive as new. Many types of new
products exist, from never-seen-before products like Apple's personal communicator, to repositioned
standards like Sears' shift to Sears Brand Central.
New product development :
1. New-to-the-world products: New products that create and entirely new market.
2. New product lines: New products that allow a company to enter an established market for the first
time.
3. Additions to existing product lines: New products that supplement a company’s established product
lines (package sizes, flavors, and so on).
4.Improvements and revision of existing products: New product s that provides improved performance or
greater perceived value and replaces existing products.
4. Repositioning: Existing products that are targeted to new markets or market segments.
6. Cost reductions: New products that provide similar performance at lower cost.
1. Idea generation – We will see whether the idea is worth consideration or not?
2. Idea screening – Is the product idea compatible with company objectives, strategies and resources?
3. Concept development and testing – Can we find a good concept for the product that consumers say they
would try?
4. Market strategy – Can we find a cost effective, affordable marketing strategy?
5. Business Analysis – will the product meet our profit goal?
6. Product development – Have we developed a technically and commercially sound product?
7. Market testing – Have product sales met expectations?
8. Commercialization – Are product sales meeting expectations?
1. Companies seek new ideas to enhances the performance of the exiting products and to innovate
new ideas. The stages is called idea generations stages. The Major sources of new product ideas
include internal sources, customers, competitors, distributors and suppliers. Almost 55% of all new
product ideas come from internal sources according to one study. Companies like 3M and Toyota have
put in special incentive programs or their employees to come up with workable ideas.Almost 28% of
new product ideas come from watching and listening to customers. Customers: About 30% of new
product ideas come from analysis of competitors’ products. The company can watch competitors’ ads,
press releases and write-ups in the press about their activities. Companies also buy competitors
information and pay for industrial espionage.Resellers and others who are close to the market, can
often pass on information about new developments. Other sources are trade magazines, shows and
seminars, market research firms, government reports, advertising agencies and new product
consultants. Employees throught the companies can be sources of ideas. Toyota claims that employee
submit two million ideas annually over 85% of which implemented.Companies also find good ideas by
researching competitor’s products and services.they can find out what the customers like and dislike
about their competitor’s products.ideas can also come from investors. External research, surveys,
industrial publications research,and development etc.But main source of idea generation is the
customers by their grievances ,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.
2.Idea screening:-
The main purpose of idea generations is to collect a large number of ideas. however, all ideas can be
commercially viable. therefore companies filter the less viable ideas with the help of systematic process.
Companies use various parameters to screen the ideas such market size, technical, capabilities and
potential completions etc.
The following issues will also help the companies to analysis the attrectiveness of the ideas.
• Whether the product idea match the exiting product of the company.
• The to which the new product cannibalize the sale of the exiting product.
• Company’s ability to produce and market the product.
• Buying behavior and probable changes in environment.
Errors
4.Marketing strategy:- This is the next step in new product development. The strategy statement
consists of three parts: the first part describes the target market, the planned product positioning and the
sales, market share and profit goals for the first few years. The second part outlines the product’s planned
price, distribution, and marketing budget for the first year. The third part of the marketing strategy
statement describes the planned long-run sales, profit goals, and the marketing mix strategy.
The following a sueccsseful concept test, the new product manager will develop a preliminary strategy
plan
• the first part describes the target market size, structure, behavior for the the first few year.
• the second part outlines the planned price distribution strategy and marketing budgets for the first
year.
• the third part of marketing strategy plan describes the long run sales and profit goals and the
marketing strategy over a time.
5..Business analysis;-
After management develops the product concept and marketing strategy, it can evaluate the business
attractiveness. Business analysis are the first in –depth financial evaluation of the new product to be
developed. Here management needs to prepare sales cost and profit projection to determine whether to
stisfy company objectives. If they do the concept moves to development stage.
Swot analysis will be prepared by the organization at this stage. It includes total sales estimation .
estimations of cost and profit.
7.Test marketing:-
Test marketing is a stage where product is introduced in the few selected cities. During this stage the
company has to fate the following expenses.
• High advertisement
• High manufacturing cost
• High distribution cost etc.
For test the product market needs to make a decision on the following issues.
• The no. of the cities in which the product is to be tested.
• Geographic location of the cities.
By this way the company can know the customer response , feedback, and suggestions.
Complaints and other changes are required for product modifications.
After successfully laughing the product in the selected cities company launches the product in all other
cities.
Gamma testing: it is carried out on long term basis where customers use the product extensively and give
response after long period of time. Say six month.
8.Commercialization:-
The result of test marketing help marketers to decide changes that are needed in the marketing mix before
entering in to the market. It also help the the marketers to decide the amount of production distribution
stategy, selling effort and other issues like providing guarantees and after sales service etc. the enter the
market during the commercialization stage.
C. TO WHOME: Within the roll-out markets, the company must target its distribution and promotion to
customer groups who represent the best prospects. These prime prospects should have been profiled by
the firm in earlier research and test marketing. For instance, Psion's Series 5 palmtop organizer, with a
price tag of £500, is targeted at high income executives. When The European newspaper launched a
multimedia version of the paper, it was initially targeted at professionals, who were sent an electronic
version of the paper via telephone to personal computers at work. Generally, firms must fine-tune their
targeting efforts, starting with the innovators, then looking especially for early adopters, heavy users and
opinion leaders.
D.HOW : The company also must develop an action plan for introducing the new product into the
selected markets. It must spend the marketing budget on the marketing mix and various other activities.
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 Nano to develop and produced a car for just Rs. 1 lakh.
• To study the objectives and target customers of Tata one lakh’s car.
• To study and compare between Tata Nano and Maruti 800 car.
• To study on consumer buying behavior and preferences and views about Tata Nano and Maruti 800
by various method of data collection.
Research Methedology
The 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:
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.
Sample size:
100 people
Sample design:
All working people are include both the gender i.e males and females irrespective of their educational
level.
Area of research:
kota
Sampling technique:
Random
• 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 it’s used for the same purpose. The secondary data sources here in this project are:
Websites
Books
Statistical analysis: The collected data were subjected to various statistical analysis for the
presentation in terms of percentage, tables, pie-charts, and column charts
Established in 1945. When the the company began making trains. The company's manufacturing base in
India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar
(Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, it has set up an
industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat
and Tata cars and Fiat powertrains. The company is establishing a new plant at Sanand (Gujarat). Tata
Motors, the first company from India's engineering sector to be listed in the New York Stock Exchange
(September 2004), has also emerged as an international automobile company. Through subsidiaries and
associate companies, Tata Motors has operations in the UK, South Korea, Thailand and Spain. Tata
Motors is equally focussed on environment-friendly technologies in emissions and alternative fuels. . It
has developed electric and hybrid vehicles both for personal and public transportation. Tata Motors is
committed to improving the quality of life of communities by working on four thrust areas –
employability, education, health and environment. Expansion
Expansion
The FIRST generation Tata Indica V2's excellent fuel economy, powerful engine and aggressive
marketing strategy made it one of the best selling cars in the history of the Indian automobile industry.
After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger
vehicle market in 1991 by launching the Tata Sierra, a multi utility vehicle. After the launch of three more
vehicles, Tata Estate (1992, a stationwagon design based on the earlier 'TataMobile' (1989), a light
commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998, India's first sports utility vehicle).
Tata launched the Indica in 1998, the first fully indigenous passenger car of India. Though the car was
initially panned by auto-analysts, the car's excellent fuel economy, powerful engine and aggressive
marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. A
newer version of the car, named Indica V2, was a major improvement over the previous version and
quickly became a mass-favourite. Tata Motors also successfully exported large quantities of the car to
South Africa.The success of Indica in many ways marked the rise of Tata Motors.[12]
Acquisitions
• In 2004 Tata Motors acquired Daewoo's truck manufacturing unit, now known as Tata Daewoo
Commercial Vehicle, in South Korea.
• In 2005, Tata Motors acquired 21% of Aragonese Hispano Carrocera giving it controlling rights of
the company.
• In 2007, Formed a joint venture with Marcopolo of Brazil and introduced low-floor buses in the
Indian Market.
• In 2008, Tata Motors acquired British Jaguar Land Rover (JLR), which includes the Daimler and
Lanchester brand names.
• In 2010, Tata Motors acquired 80% stake in Italy-based design and engineering company Trilix for
a consideration of €1.85 million. The acquisition is in line with the company’s objective to
enhance its styling/design capabilities to global standards
TATA NANO
In January 2008, Tata Motors launched Tata Nano, the least expensive production car in the world at
about Rs. 100,000 . The city car was unveiled during the Auto Expo 2008
exhibition in Pragati Maidan, New Delhi. The Tata Nano car which is
often called as the “people’s car” was launched on March 23, 2009. The
sales of the Tata Nano car kick-started from July 2009. Priced at a mere
Rs.1,15,000. the Tata Nano car has been a hit amongst the middle class till
date, for whom the car was quite affordable.The introduction of the Tata
Nano car received attention mainly because of two specific reasons.
In January 2008, Tata Motors launched Tata Nano, the least expensive production car in the world at
about Rs. 100,000 . The city car was unveiled during the Auto Expo 2008 exhibition in Pragati Maidan,
New Delhi. The Tata Nano car which is often called as the “people’s car” was launched on March 23,
2009. The sales of the Tata Nano car kick-started from July 2009. Priced at a mere Rs.1,15,000. the Tata
Nano car has been a hit amongst the middle class till date, for whom the car was quite affordable.The
introduction of the Tata Nano car received attention mainly because of two specific reasons.
• The car being priced relatively at a lower rate than other cars drew attention from the commoners.
• The other reason was the prolonged Singur (West Bengal) agitation, that the company Tata Motors
had to face while setting up a factory in the area. Charges of land acquisition were drafted against
them by the farmers and the company forcefully had to stop putting up the plant in Singur as a result
of chaos and disturbance in the area.
The introduction of the Tata Nano car was entirely planned out and
designed by the chairman of the Tata Motors, Mr. Ratan Tata. Although
several speculations regarding the Tato Nano car being a “four-wheeled
auto-rickshaw” with no ample space or whatsoever did rounds in the media,
still the Tata Nano car proved itself of being a properly built car. The Tata
Nano car possesses extensive cost-cutting features that includes a single
wind screen wiper instead of a double one, it has no power steering, the door opener was simplified
et.al.After removing its base from Singur, Tata Motors had decided to set up a plant in Gujarat. No
wonder the arrival of the Tata Nano car has stirred up a lot of news for a couple of years, but yes, the
Tata Nano car is launched and is already gathering mixed reviews from the buyersTata has faced
controversy over developing the Nano as some environmentalists are concerned that the launch of such a
low-priced car could lead to mass motorization in India with adverse effects on pollution and global
warming. Tata has set up a factory in Sanand, Gujarat and the first Nanos are to roll out summer 2009.
Tata Nano Europa has been developed for sale in developed economies and is to hit markets in 2010 while
the normal Nano should hit markets in South Africa, Kenya and countries in Asia and Africa by late 2009.
A battery version is also planned. India's largest vehicle maker, Tata Motors is planning to launch the
European variant of Tata Nano, known as 'Nano Europa' in India. The new luxury variant of the world's
cheapest car, Tata Nano, will have power steering, powerful engine, air bags and ABS as safety features.
Nano Europa was displayed in geneva moter show in 2009.
According to MD PM Telang of Tata Motors India, the company is looking forward to launch the fully
loaded car in India when it gets ready for its debut in Europe market. He added that Nano Europa will
have several features like a more powerful engine, power steering, ABS, airbags.
The structural strengths, indicate a longer wheelbase and interior design modifications to suit the
European market. Speculations say that, the Nano Europa will be powered by 3 cylinder sporty all-
aluminium MPFI engine with a 5-speed automatic transmission. Tata Motors is developing this petrol
engine which will be fuel efficient and will also have lower CO2 emission, lesser than 100 gm/km. We
can expect the Nano Europa in 2012.
• 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.
Details Of Nano
1.Specs:
Engine: 624 cc / 33 bhp
4 door, 5 seater (and yes 4 Wheeled too)
Rear Engine
Weight: 600 kgs
Mileage - 22-23 km/liter
2.Variants:
Standard
Deluxe (with AC)
3.Future:
Diesel Variant
Exports outside India or assembly plants outside
4.Comparison
8% less in length (bumper to bumper) with respect to Maruti 800 21% more in inner space with
respect to Maruti 800
5.Looks:
Front side looks more like Matiz (or Spark as we now call it)Back side looks more like India with
those long tail lights.
6.Insight:
People often criticize something that is making waves everywhere. This has also been the case with
Tata Nano. Competitors, safety regulators, environmentalists and most others conceived the
problems that India will face, when such a car is available, much before the actual launch of the car.
This will result into:
OLD GENERATION NEW GENERATION
strength Price, mileage, style, brand name, all weather vehicle, first innovation.
weekness Fiber body, low suspension power,low engine capacity, light vehicle, not
suitable for hilly areas, delay due to singur violation.
opportunity Bikers can be motivated, auto rickshaw & second hand market can be
motivated. large market for selling. Awareness in the market.
Threat Other competitors (Bajaj, Maruti), not eco-friendly, Govt. may come with
new rule.not sure to hit rural and semi urban market.
As seen before, A product can be considered new under the following situations.
• New to the world product
• New product lines
• Additions to the existing product lines
• Improvement and revision of existing products
• Repositioning
• Cost reductions
As 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 it’s 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 today—an 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 Nano—on average aged between
25 and 30—has helped to flatten Tata Motors' stodgy, multilayered management structure, which has
resulted in an unexpected side-benefit called "organizational innovation".
Idea screening
The 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 people’s car it should be a car and not something that
people would say,“ Ah! That’s 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 Developing
Before 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 didn’t 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 involved—designers, manufacturing teams, and vendor
development people—be 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 designer—he 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 Analysis
Cost
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
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:
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:
In short select a manufacturing location where all the advantages could be achieved.
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 Development
And finally the product was developed with the following features.
• Engine Capacity Bosch 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 verdict
Nano is soon going to launch by the end of April. It will be commercialized in whole of India. It is mostly
targeted to the middle class and lower middle class people. The effects of Nano and its commercialization
will be soon known after it comes into the market.
When 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, it’s 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
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.
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.
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
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.
v/s
As 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.
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 person
WEIGHT
• Maruti 800 – more than 690 kg (gross weight is 1000 kg)
• Nano – more than 600 kg
TOP SPEED:
• Maruti 800 : 120 km/hr
• Nano : 90 km /hr
SEGMENT:
Maruti 800 – middle class people
Nano: lower and middle class people.
FUEL CONSUMPTION:
Maruti 800: city 13.6 and highway 17.6 km
Nano: city 22 km and highway 26 km
DIMENSIONS:
Maruti 800 Tata Nano
Length 3.335 3.1 meters
meters
(131.3 inch
Width 1.440 1.5 meters
meters
(56.7 inch)
Height (55.3 1.6 meters
inches)
BREAKS:
• Maruti800: Front Disk, Rear Drum
• Nano: Front Disk, Rear Drum
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.
This pie chart show that 39% people agree that NANO should be purchased instead of byke. While 20%
People are strongly agree. And 19% are netural.
Q2. Which feature of NANO attracts you more ,that inspire you to go for for NANO?
This pie chart show that 53% people attracts towards NANO because of low price and 35% like
because better mileage.
This pie chart shows that 44% people think NANO is made for people which means every class
people can afford NANO and 24 people are also strongly satisfied with this question.
Q5. If the price of NANO increases, would you still purchase it?
This pie chart shows that 50% would not purchase TATA NANO is price increase in future. While 46%
People are netural.
Q6. Will there be traffic problem with the introduction of NANOon Indian roads?
On the basia of this pie chart we can say that 34% people are netural they don’t think that traffic problem
Increase duu to introduction of TATA NANO while 29% people are agree.
This pie chart show that 39% people don’t trust on TATA NANO when it comes in seafty. While 28%
People are netural about features of TATA NANO.
Q8. Will TATA be able to maintain the price of NANO in future if there is hike in cost of raw
materials ?
According tp this pie chart 33% people are netural. They think future price will depend of
company policies. How they utilise the resources if prices of raw material increases in near future.
But 30% people are disagree with question they think that TATA will not be able to sale TATA
NANO in same price if price incerases in future.
Q9. Do you think NANO will be as successful as Maruti 800 ?
According to this pie chart we can compare tata nano with maruti 800 here 43% people say that
success
of tata nano will depend on performance. If it satisfy all the expectation of consumer it will
definatily get good response. But on other hand 30% people say that tata can not get response as
maruti has got.
In this pie chart 49 % people have no knowledge about nano’s services. While 31% people agree
that
We are aware with nano sales service.
According to this pie 28% people say that nano can be better option for those who can not afford
car because of low mileage. While 55% people think that fuel consumption of nano is better then
others small cars.
On the basis of this pie chart we can say that people want to purchase nano because of low price.
While 25% people want to purchase nano because it’s an indian car and brand value of tata moters
in the eyes of customers.
Q14. Do you think NANOis designed and built according to India’s local weather and road
conditions ?
In this pie chart 40% people don’t have knowledge about nano whether it has been developed
according
To india’s local weather and road conditions. While 34% people are agree that nano has been
developed
To keep in view of india’s local weather and road condition.
Q15. According to your opinion what can be done to improve NANO’s sales in local markets ?
This pie chart shows that 49% people thin that new modal of tata nano should be launched in the
market
To boost up sales and to capture market. On the others hand 29% people say that tata moters should
add new and unique features to improve the quality of the car so that sales target can be achive
effectively.
This pie chart is indicating overall perception of people towards tata nano. What they think about
tata nano. Here 40% people have no view about tata nano. But 33% people are satisfied with tata
nano.
Negative Response
• It is impossible to build a car at such a price. No one has been able to do it so far. It is just not
possible.
• It will be more like a scooter with a roof. I am sure no one can make the car for the cost of two
bikes.
• This car is another auto rickshaw. It will add a lot to the traffic on road.
• It shall be a half car with no roof. I doubt if it will be able to go up the flyovers.
• It may be an upgraded Auto-rickshaw with plastic body. It shall be a very unsafe car as the very
idea of 1 Lac car is too farfetched to be true.
Mixed Response
• It has not been done ever.. Even the nearest car is double the cost. Let us see what Mr. Tata can do
to maintain the price line.
• I am not very convinced but would definitely go for it if it is safe.
• I hope I can take my family of 4 in this car. I wish Tata's make this dream a reality.
• I know the talk is that it is a myth. However miracles do happen. Let us wait and watch.
• The reaction was a mixed one. People wished it to be true but were very cautious about expressing
their optimism.
Communalities
Initial Extraction
Q1 1.000 .790
Total variance
Q3 1.000 .757 table :
Q6 1.000 .949
This table indicates
Q7 1.000 .670 the amount of
variance explained
Q8 1.000 .768 by various primary
Q10 1.000 .661
factor post extraction
and the impact of the
Q12 1.000 .875 same.
Q14 1.000 .866As observed from
Q16 1.000 .561 the table given
below that primary
Extraction Method: Principal Component Analysis. factor (3) contributes
to 54% of the
customers belief.
Out of all the factors,
perception to the nano is the factor contributing the most significant portion on study i.e. 27%.
Primary factor
1 2.442 27.138 27.138 2.442 27.138 27.138
Secondary factor
4 1.026 11.403 65.368 1.026 11.403 65.368
five factors having eigenvalue >1 have been statistically obtained but in order to improve
effectiveness of the study, we have only considered first 3 factors as our primary influencing
factors. The remaining factors are considered as secondary influencing factors.
r
o rs as ou
er ed f ir st 5 fact
sid
Primary
e ha ve only con
y, w
the stud
Factors
f f e ctive ness of
e
r der to improve
o
Secondary Factors
CONCLUSION:
component matrix
1 2 3 4 5
Q1 0.656 -0.379 0.053 0.083 -0.461
Q3 0.636 -0.309 -0.354 0.357 0.066
Q6 0.017 -0.459 0.286 0.05 0.808
Q7 0.628 0.048 0.062 -0.519 -0.02
Q8 0.379 0.691 0.154 -0.279 0.215
Q10 0.721 0.149 0.188 0.243 0.158
Q12 0.11 0.325 0.636 0.578 -0.135
Q14 0.171 0.431 -0.702 0.327 0.228
Q16 0.731 -0.085 0.005 -0.205 0.056
Primary Factors:
Secondary Factors:
Conclusion
Reccomendation
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.
• Someone who is looking for long drives.
• 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 tata’s. It’s something on
which India can feel proud of. Nano has been developed effectively.
In brief we can say that nano is specially made for middle and higher class people. Because middle class
people Have many option in this sagment. If we compare tata nano with maruti 800,30 % people think
thak tata nano will not be able to perform as maruti 800 did in the market. and overall result of
questionnaire shows that 40 % people are netural about overall Saisfaction of tata nano and 22% people
are satisfied with tata nano.so major portion of customer are showing that Tata Nano can not perform as
Maruti 800 and others small car. I cn reject null hypothisis H(2), Nano is better than Maruti 800, which i
have written in my synopsis. and we have to take alternate hypothsis A(2) means Maruti 800 is better than
Tata Nano.
References:
• Ulrich, Karl T. and Eppinger, Steven D (2004) Product Design and Development, 3rd
Edition, McGraw-Hill, New York, 2004
• Ullman, David G. (2009) The Mechanical Design Process, Mc Graw-Hill, 4th edition
• Koen, Peter A. (2004), "The Fuzzy Front End for Incremental,Platform,and Breakthrough
Products", PDMA Handbook of New Product Development, 2nd Ed.: 81–91
Bibliography:
Websites
• http://en.wikipedia.org/wiki/tatanano
• www.google.co.in
• www.carblogindia.com/cars
• www.carblogindia.com/tata-nano-vs-maruti-800/
• http://www.pdma.org/npd_glossary.cfm
• www.vedamsbooks.com
• www.tdiindia.com
NAME: ……………………………………
AGE: ……………………………………...
EDUCATION: ……………………………
GENDER:
Male [ ] Female [ ]
OCCUPATION:
Self Employed [ ] Job [ ]
[ ] [ ] [ ] [ ] [ ]
2. Which feature of NANO attracts you more, that inspires you to go for
NANO?
Price [ ] Design [ ]
Mileage [ ] Interior space [ ]
All of the above [ ]
[ ] [ ] [ ] [ ] [ ]
[ ] [ ] [ ] [ ] [ ]
8.Will Tata be able to maintain the price of nano in future if there is hike in cost of raw materials
Strongly disagree Disagree Neutral Agree Strongly agree
[ ] [ ] [ ] [ ] [ ]
[ ] [ ] [ ] [ ] [ ]
[ ] [ ] [ ] [ ] [ ]
[ ] [ ] [ ] [ ] [ ]
15. According to your opinion what can be done to improve Nanos’ sales in local
markets?
Nano should provide new models [ ]
Improve quality and so that car maintainence cost is decreased. [ ]
Should reduce car prices [ ]
Lower instalments [ ]
[ ] [ ] [ ] [ ] [ ]