Assignment # 1 | TATA Motors –Nano

Suggested Answers Discussion Points | Cover the following point while answering the case study
questions

1. Opening should highlight TATA group’s strength and relatively a riskier move to enter the
competitive automobile sector of india with a big task to deliver car in the lowest price
 TATA Motors failed to analyse the market and competition | Already available better
competition in form of Suzuki | Compare and justify a lil higher price of Suzuki and
absence of basic features in Nano
Make a sub-points to discuss quality issues and incident of fire; low speed, missing basic
features
 Delay (1.5yrs) in launch due to shifting the manufacturing plant
 Instead of increasing capacity in phases they started with high capex which further
enhanced their fixed cost and in turn constrained to keep the price of NANO low as
promised
 Target /niche market should be carefully identified
 Brand should be positively marketed | Refer to ‘cheapest car’ and negative psychological
impact on potential customers
 Lack of contingency planning

2. TATA Motors considered (i) social factors – change the product image from a cheap car to an
“awesome car” along with changing target market from rural to urban low income population, (ii)
economic factors – keeping prices low though they increased the price but kept it competitive,
and (iii) technical factors – added basic features and ensured safety standards; revamped product
by changing manufacturing strategy and accordingly devised marketing strategy; test drives, post
sales service contracts and marketing the advanced and competitive vehicle features.

3. They can succeed with their upgraded version of TATA models in India and other developing
countries.

Cover the downside: Success of Tata’s low-cost model sales may be impacted as how the existing
competitors respond in terms of pricing of their cars.

A brief discussion on introducing the new models in other developing economies after studying
the related industries and duty structure.

Comments:
Always attempt according to marks; the higher the marks, more meat it should have and of course the
discussion.
Follow paragraph point system for your own clarity of writing and for ease of reader’s marking. Point
should be highlighted at least