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Introduction Of Tata Nano
• “Dream-dream and dream, because dream gives vision, vision gives thoughts and finally thoughts lead to the action". Each letter of these motivational words said by India's former President Dr. A.P.J. Abdul Kalam goes exactly with Mr. Ratan Tata, Chairman of Tata group, who in the year 2003, dreamt of producing a safe, affordable Car for the common man. Finally after the wait of five years, crossing all financial and technological barriers, Ratan Tata kept his promise and unveiled Tata 'Nano' on 10th January 2007, at the 9th Auto Expo 2008 in New Delhi. Tata Nano, cool & smart, launched by Tata Motors is world's cheapest Car with a price tag of $ 2500.
Description about Nano
The project has literally become India's claim-for-fame in the internationalmedia 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%. The car was envisioned by renowned industrialist, Ratan Tata, Chairman of the Tata Group and Tata Motors, who has described it as an eco-friendly "people's car". Nano has been greatly appreciated by many sources and the media for its low-cost and eco-friendly initiatives which include using compressed-air as fuel and an electric-version. Tata Group is expected to mass-manufacture the Nano in very large quantities, particularly the electric-version, and, besides selling them in India, to also export them world-wide.
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) Top Speed Emission Norms Safety Norms Versions 75 K.M Euro-IV, Bharat Stage-III compliant Frontal Crash Tested One Standard and Two Deluxe
Reactions about Nano
• "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 upgradation 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.” Said 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.
What makes it so cheap !
• The Tata Nano uses plastics and adhesives rather than welding. • introducing the car with an artificially low price through govt-subsidies and tax-breaks, or • using vertical-integration, or • partially using inexpensive polymers or biodegradable plastics instead of a full metal-body. • It has no AC, no power steering, no power windows, no power bells and whistles.
• The low-cost car is clearly intended for the masses. For the family of four that would otherwise ride on a scooter, precariously balancing a tiny tot on the front and a baby on the wife’s lap. For the first-time car buyer in India - a huge market despite the increasing number of cars in the urban and semi-urban areas. Its Also attract the small cars buyers like maruti 800.
• • • • Overview of Indian Economy Industrial Profile Profile of Indian Automobile Industry Tata Motors
Overview of Indian Economy
• The Indian economy continued to register impressive GDP growth, although the rate of growth declined marginally over the previous year, reflecting inflationary trends driven by the increase in the cost of energy and raw materials. The level of industrial activity has also begun to decline as a result of fiscal constraints imposed on money supply and the raising of interest rates . Investment flows into India increased by 20% to a record level of about Rs. 120,000 Crores. The Indian automotive sector grew by 10% overall during the year with substantial growth in the Light Commercial Vehicles sector and new passenger car introductions. In the country 499,978 new commercial vehicles were sold during the year and passenger car sales grew to 1.53 million vehicles this year.
Indian Automobile Industry
According to the UNIDO International Yearbook of Industrial Statistics 2008, India features among the top 15 auto-makers. Currently, it ranks 11th in the world in terms of car production and 13th in terms of commercial vehicle production, which includes both 2-wheelers and 4-wheelers. At the same time, the Indian car makers are earning acclaim worldwide.
The first automobile in India rolled in 1897 in Bombay. India is being recognized as potential emerging auto market. Foreign players are adding to their investments in Indian auto industry. Within two-wheelers, motorcycles contribute 80% of the segment size. Unlike the USA, the Indian passenger vehicle market is dominated by cars (79%). Tata Motors dominates over 60% of the Indian commercial vehicle market. India is the fourth largest car market in Asia - recently crossed the 1 million mark. 2/3rd of auto component production is consumed directly by OEMs. India is the largest three-wheeler market in the world and the largest two-wheeler manufacturer in the world. India is the second largest tractor manufacturer in the world. India is the fifth largest commercial vehicle manufacturer in the world. The number one global motorcycle manufacturer is in India.
The liberalization policy and various tax reliefs by the Govt. of India in recent years has made remarkable impacts on Indian Automobile Industry. Indian auto industry, which is currently growing at the pace of around 18 % per annum, has become a hot destination for global auto players like Volvo, General Motors and Ford. In India there are 100 people per vehicle, while this figure is 82 in China. It is expected that Indian automobile industry will achieve mass motorization status by 2014. The passenger vehicle industry also witnessed a slowdown but managed to grow by 11.1% by increasing discounts on mature products, launching new models and due to reduction in excise duty announced by the government in Budget during February’08. Vehicle exports also grew, albeit at a slightly lower rate of 11.9% as compared to 14.8% witnessed in the previous year The domestic commercial vehicle industry grew by 6.9% as compared to over 33% growth achieved in the last fiscal.
Tata Motors Limited
Tata Motors Limited, formerly known as TELCO (TATA Engineering and Locomotive Company), is a multinational corporation headquartered in Mumbai, India. It is India's largest passenger automobile and commercial vehicle manufacturing company. Part of the Tata Group, and one of the world's largest manufacturers of commercial vehicles. The OICA ranked it as the world's 20th largest automaker, based on figures for 2006. Tata Motors has its manufacturing base in Jamshedpur, Pantnagar, Lucknow, Pune. Tata Motors was established in 1945, when the company began manufacturing locomotives. The company manufactured its first commercial vehicle in 1954 in collaboration with Daimler-Benz AG, which ended in 1969. In March 2008, it finalised a deal with Ford Motor Company to acquire their British Jaguar Land Rover (JLR) business, which also includes the Rover, Daimler and Lanchester brand names.The purchase was completed on 2nd June 2008.
Performance of the company’s stock prices (vis-à-vis Sensex and Auto index)
Market price data on BSE/NSE
News from various surveys and research worldwide
Small cars have big potential: Survey Business Standard: January 15, 2008 Tata Nano sets the platform for India as a frugal engineering hub livemint.com: January 11, 2008 Global problems, Desi solutions The Economic Times: May 15, 2008 Nano makes it to Time's most important cars of all time The Hindu Business Line: January 17, 2008 Indian auto industry to lead globally by 2020: IBM New Delhi: The Indian automobile industry is all set to be the global leader by 2020 with the trailblazing work done by the Tatas, according to IT and consultancy giant IBM. September 08, 2008 (sources : Indian Brand Equity foundation www.ibef.org) The car itself is expected to boost the Indian Economy as well as expand the Indian car market by 65%, according to rating agency CRISIL.
Obstacles to Nano
However, Due to the Singur land dispute, the "Stalled Car Factory" is "Costing Jobs, Splitting Neighbors in West Bengal” “ Tata's problems in West Bengal are scaring off other industries hoping to locate here, including Infosys, a software maker that wanted to build a business park that would provide 5,000 jobs. Due to ongoing opposition to Tata's Singur car-factory by Mamta Banerjee, who demanded land to be returned from the factory, Tata Motors took decision to pull out of Singur. Tata Motors is manufacturing Tata Nano at its Pantnagar plant. Tata Motors announced it was pulling out its Nano small car industrial project from West Bengal's Singur and blamed the Mamata Banerjee-led Trinamool Congress, which spearheaded the protests against the factory, for the 'painful' decision. While existence of Tata Nano could lead to high industrial growth , the exit lead west Bengal a loss of more than 80,000 crore .How ever Tata has to suffer in terms of delay and settlement cost .
Competencies of Tata Nano
• Tata is now 57th most valuable brand globally livemint.com: April 22, 2008 The Tata group’s intense activities in 2007 have seen it rising 45 places to No. 57 in Brand Finance Top 500 Global Brands • Expectations According to one report, India as well as other nations, such as European nations[, have great expectations from the Nano and are keenly and eagerly eagerly awaiting it, especially the electric version of the Nano. • Modular design
In fact, Tata envisions going even further, providing the tools for local mechanics to assemble the car in existing auto shops or even in new garages created to cater to remote rural customers. With the exception of Manjeet Kripalani, BusinessWeek's India bureau chief, few have focused on this breakthrough element of the Nano innovation (BusinessWeek.com, 1/10/08).
Competencies of Tata Nano
• Pricing strategy Tata initially targeted the vehicle as "the least expensive production car in the world"— aiming for a starting price of 100,000 rupees or approximately $2300 US despite rapidly rising material prices • Export expectation
• Being worlds cheapest car it is expected that not only India demand for Nano will go rise at global level. Since it meeting Euro-4 norms at this price so this is taking as a future of small car segment .
• Reputation and Acceptance of Tata After launch “TATAs have shown the world what Indian engineering is truly capable of”
Financial Times U K reports
• Enthusiastic support Tata Motors is receiving preliminary and some very enthusiastic support in the media and officials, even from Europe, for the electric-version from India as well as other-nations. The enthusiasm is even higher than that for the petrol-version
Future of Nano (conclusion)
• • Emerging markets are a fertile ground for innovation. The challenge of reaching dispersed, low-income consumers in emerging markets often spurs significant innovation. As customers gain more power, they will demand more tailoring and value-added service to meet their needs. Companies that innovate on this dimension are likely to be richly rewarded. World is getting tougher day by day being unique is a competitive advantage. Expectations to Nano has proved this . After 100 years to Henry Ford , Tata has proved him again not only he came out of the expectations but also came out with a platform for Indian auto sector .
• So this as per this project conclusion can be draw as a future car not only of Indian but also if exported than could be to the world.
Important questions ?
• Will the Nano succeed? • Car of the Future? • Is it fair to blame the Nano for the (upcoming) ills of Indian road infrastructure? • What do you think? Is the Nano a car of the future? Or just another Yugo debacle waiting to happen? Would you drive one?
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