nano- new product dev

8/2/2019 Nano- New Product Dev.

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PREFACE

This is the specialization project on astudy on new product development for Tata Nano

along with a comparative study between Tata Nano

and Maruti 800. The objective of this study is to gain

knowledge about how Tata brought this new product

i.e., Nano up to the development stage and finally

going to launch it on 23rd of March.

The project was assigned by Dipti Mam

(co-coordinator) and Dwani Mam (assistant co-

ordinator).

During the project I researched on how

Tata developed Nano costing Rs 1 lakh and what will

be its effects. This study also includes comparison

between Tata Nano and Maruti800. A survey was also

done for understanding consumer buying pattern and

preferences.

Thus, this study is based on new

product development in marketing for Tata Nano.

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ACKNOWLEDGEMENT

I am thankful to SNDT University and

Gandhi Mahila College and specially BMS department

who provided me with the opportunity for carrying out

the study.

I would also like to acknowledge my

sincere thanks to our co-ordinator Dipti Mam. Under

their valuable guidance, constant interest and

encouragement, who have devoted her ever-precioustime from their busy schedule and helped me in

completing the project. Her co-operation was not only

useful for this project but will be a constant source of

inspiration for me in the future.

I express gratitude to various faculty

members especially Sandeep Sir for his valuable

guidance which was a good learning experience in

order to make my efforts successful.

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Special, continual assistance while

collecting the data was provided by the respondents. I

wish to acknowledge my special thanks to them for

their help and cooperation in order to complete this

project.

I am also thankful to those who have

helped me intellectually in preparation of this project

directly or indirectly.

I am deeply indebted to the various

sources of information from relevant sites from

internet and books which helped me a lot in my study

and helped me to learn a lot.

Table of contents:

Sr. subject Pg. No

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No.

1 Objective of research 5

2 Methodology of research 6

3

Introduction to the subject new productdevelopment 7

4 Introduction to Tata Nano 19

5 Tata Nano and new product development 25

6 Some myths about Nano 44

7

Comparison between Nano and Maruti800 49

8 Data collection method 56

9 Analysis of data collection 60

10 Various charts 60

11 Some feedback about Nano 67

12 Conclusion 70

Research objectives

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o To study about how a new product- Tata Nano

was developed based on marketing theory of

new product development.

o To study about what made possible for Tata to

develop and produce a car for just Rs. One lakh.

o To study the objectives and target customers of

Tatas one lakh car

o To study and compare between Tata Nano and

Maruti 800

o To study on customers buying behavior and

preferences and views about Tata Nano and

Maruti 800 by various methods of data collection.

Introduction To New ProductDevelopment

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Meaning Of Product:

E.g.:- milk, computer, shoes, service after

sales, railway services etc. a product can be divided into

two categories

o Tangible goods

o Intangible goods

Tangible products are known as goods that

can be touched, felt and seen. E.g.:- computer, mobile

phone etc

Intangible products are known as services

that cannot be touched and seen as the customer can feel

and experience only after utilizing it. E.g.:- service after

sales

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New Product Development:

A product can be considered new under thefollowing situations:-

New-to-the-world products

New product lines

Additions to existing product lines

Improvements and revisions of existing

products

Repositioning

Cost reductions

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Stages Of New Product Development

Before the introduction of a product into

the market, it goes through several stages of

development. These stages are known as stages of new

product development. It includes the following:

Idea Generation:

Companies seek new ideas to enhance the

performance of the existing products and to innovate new

ideas. This stage is called idea generation stage. There are

many sources for idea generation. It may be from

customers, dealers etc.

Employees throughout the company can

also be a source of idea. Toyota claims that its employees

submit two million ideas annually over 85% of which are

implemented.

Companies also find good ideas by

researching competitors products and services. They can

find out what the customers like or dislike about their

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competitors products. Ideas can also come from investors.

External research, surveys industrial publications research

and development etc.

But the main source of idea generation

is the customers by their grievances and 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.

Idea Screening

The main purpose of idea generation is to

collect a larger number of ideas. However, not all ideas can

be commercially viable. Therefore, the companies filter the

less viable ideas with the help of systematic process.

Companies can use various parameters to screen the ideas

such as market size, technical capabilities, potential

competition etc.

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Addressing the following issues will also

help the companies to analysis the attractiveness of ideas.

Whether the product idea match the

existing products of the company.

The degree to which the new product

can cannibalize the sale of the existing

product.

Companys ability to produce and

market the product.

Buying behavior and the probable

changes in the environment.

While screening the ideas, an

organization may commit two types or errors.

Drop error where the firm rejects a very good idea.

Cro error where a company selects a poor idea.

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The first part describes the target market size,

structure and behavior for the first few years.

The second part outlines the planned price distribution

strategy and marketing budget for the 1st year.

The third part of marketing strategy plan describes

the long run sales and profit goals and the marketing

mix strategy over time.

Business Analyses.

After management develops the product

concept and market strategy, it can evaluate the business

attractiveness. Business analyses are the first in-depth

financial evaluation of new product to be developed. Here

management needs to prepare sales cost and profit

projections to determine whether they satisfy company

objectives. If they do, then concept can move to the

development stage. SOWT analysis will be conducted atthis stage by the organization. It also includes the

following:

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Total sales estimation:-

These are the sum of estimated first- time

sales, replacement sales and repeat sales. Its method

depends upon whether the product is one time

purchase(an engagement ring), an infrequently purchased

products like toaster, auto mobile etc. or a frequently

purchased products like consumer and industrial non

durables.

Estimation costs and profits.

The R&D, manufacturing, marketing and

financial departments estimates the costs. The profitabilityof the new product is estimated through various financial

tools. The simplest technique is the breakeven analysis in

which the management estimates how many units of the

product the company would have to sell to break even with

the given price and cost structure. If the management

believes that sales could easily reach the break even

number, it is likely to move the project into development

stage.

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Product Development

In this stage, detailed technical analysis

is conducted to know whether the product produced at

costs is low enough to make the final price attractive to

the customer.

Here a working model or a prototype isdeveloped to disclose all tangible and intangible attributes

of the product. A product protocol is prepared which is a

detailed downiest containing the important attributes that

are expected in the product. Once the protocol has been

developed, it is handed over to the research the

development department to develop the prototype of the

product.

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Test Marketing:

The test marketing is the stage where

the product is introduced in a few selected cities. During

this stage, the company has to fate the following expense:

High advertisement

High manufacturing cost.

High distribution cost etc.

For testing the product, marketer needs

to make the decision on the following issues.

The no. of cities in which the product is to be tested.

Geographic location of the cities.

Time to carry ort test marketing

Through this exercise, company can

know the customers response, feedback, suggestions,

complaints and any other changes required to be done for

product modification.

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After successfully laughing the product

in selected cities the company launches the new product in

all other cities.

Commercialization:

The results of the test marketing help

marketers to decide the changes that are needed in the

marketing mix before entering into the market. It also

helps the marketer to decide the amount of production

distribution strategy, selling efforts and other issue like

providing guarantees, service after sales etc. the product

enters the market during the commercialization stage.

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Introduction To Tata Motors:

o Tata Motors was established in 1945,

when the company began making trains.

o It has its manufacturing base in

Jamshedpur, Lucknow, Pune and soon

one more plant is going to established at

Singur, West Bengal.

o Product Manufactured - Passenger

Cars and commercial vehicle

o Installed Capacity - 350,000-400,000

vehicles a year

o Investment - Rs 2,500 crore (Rs 25

billion)

o Turnover - $21.9 billion (Rs 967,229

million)

o Employees - 2,46,000/22001

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http://en.wikipedia.org/wiki/1945http://en.wikipedia.org/wiki/Trainhttp://en.wikipedia.org/wiki/Jamshedpurhttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Singurhttp://en.wikipedia.org/wiki/West_Bengalhttp://en.wikipedia.org/wiki/Commercial_vehiclehttp://en.wikipedia.org/wiki/1945http://en.wikipedia.org/wiki/Trainhttp://en.wikipedia.org/wiki/Jamshedpurhttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Singurhttp://en.wikipedia.org/wiki/West_Bengalhttp://en.wikipedia.org/wiki/Commercial_vehicle


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o Tata Motors had created the wealth Rs.

320 billion during 2001-2006 and stood

among top 10 wealth creators in India.

Tata Nano - ONE LAKH CAR

PROJECT Peoples Car

A promise is a promise, said Rattan Tata,

Chairman,Tata Motors, on 10th January, 2008, when the

Nano was first displayed at the Auto Show in Delhi. The

Nano project didnt grab the attention of only Indians;

the entire world had their eyes glued to the worlds

cheapest car.

A truly Peoples Car, this time is from India.

Though the dealer price is Rs. 1 lakh, the price on road,

when it will be launched, will reach around Rs. 1,25,00

but it will be still more affordable and will be more eco-

friendly than most other cars giving a mileage of around

23km/liters. The price of the car is such that a lot of rich

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and HNIs, if interested, can buy the car just by a single

swipe of their credit cards.

Providing a car worth rupees one lakh car

was the dream of the chairman of Tata motors Mr. Rattan

Tata. And with high qualified IT skills people he has

shown the Indian talents to whole the world.

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

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May western countries as well as many foreign

countries have accepted Indian IT skills.

Details Of Nano

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

Variants:

Standard

Deluxe (with AC)

Future:

Diesel Variant

Exports outside India or assembly plants outside

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Comparison

8% less in length (bumper to bumper) with respect

to Maruti 800 21% more in inner space with respect

to Maruti 800

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.

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 isavailable, much before the actual launch of the car.

This will result into:

OLD GENERATION NEW GENERATION

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SOWT Analysis

STRENGTH

Brand name

TATA

Cost price low

Fuel efficient

Safe

OPPORTU

NITIES

Large market

for selling

Awareness in

the market

First car in low

range

Can hit in global

market

WEAKNESS

Low power

Not a status symbol

Delay in manufacturing

Limited features

THREATS

Company rival

Not sure to hit in rural and semi-urban areas

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New Product Development AndNano

As seen before, A product can be considered

new under the following situations:-

New-to-the-world products

New product lines

Additions to existing product lines

Improvements and revisions 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.


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It can also be considered as new product in

the since of cost reduction as its 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 todayan 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 Nanoon average aged

between 25 and 30has helped to flatten Tata Motors'

stodgy, multilayered management structure, which has

resulted in an unexpected side-benefit called

"organizational innovation".


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Idea Generation And Nano

A dream is born

Says, I observed families riding on two-

wheelers -- the father driving the scooter, 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.

So when Tata Motors needed someone to

take charge of the company's most ambitious plan yet to

build the world's cheapest car ever Ravi Kant, who by then

had become the company's managing director, again

turned to Wagh. Wagh remembers what he learned

marketing the little truck. "People want to move from two-


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wheelers to four-wheelers," he says. "Today they can't

afford it."

More and more can, but Indian car buyers

today represent a tiny slice of a potentially giant market

India has just seven cars per 1,000 people. India's auto

industry has grown an average of 12% for the past decade,

but just 1.3 million passenger vehicles were sold in India in

the fiscal year ending March 2006. That means a billion

Indians buy about the same number of cars in a year as

300 million Americans buy in a month.

If four wheels cost as little as two wheels,

that could change fast. About 7 million scooters and

motorcycles were sold in India last year, typically for prices

between 30,000 rupees and 70,000 rupees, about $675 to

$1,600. Tata is targeting a price of 100,000 rupees one

lakh, in Indian terms of measurement or about $2,500 at

current exchange rates, for its small car. That sounds

impossibly cheap in the West but remains three times


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higher than India's annual per capita income. The average

pay for factory workers at Tata Motors is just $5,500 a

year.

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?


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But the market wanted a car and if they build a peoples

car it should be a car and not something that people would

say, Ah! Thats 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."


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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


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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.


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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.


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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 didnt 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

peoplebe there to accelerate decision-making and

problem-solving.

Over time, Wagh's team grew to comprise

some 500 engineers, an impractically large group to


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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 designerhe 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,


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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 thefollowing diagram


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The design has to question the need of eachand every component from the point of view of its

necessity of existence and also the minimum requirements

of its 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:
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Significantly cheaper than existing

Technology.

Is much higher performing?

Has greater functionality and

Is more convenient to Use.

Brings to market a totally different Value

proposition than the one available and

can change the Paradigm about a

product.

The Guiding factor was that the cost has to

be minimized for each component yet maintaining its basic

functionality.

The Alternatives are:

Reduce Consumption of Material being

used.

Alternate Suppliers to get same material

at fewer prices.


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Use alternate materials.

Eliminate use of Material.

Eliminate a process Or a Combination of

the above.

The design was outsourced to Italy's Institute

of Development in Automotive Engineering, but Tata

himself ordered changes along the way. Most recently he

vetoed the design of the windshield wipers. His solution: a

single wiper instead of two, giving the car a cleaner look.

THE COST REDUCTION PARADIGM Value Engineering

Alternatives:

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.


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The Guiding factor was that the tax structure,

on materials and manufacturing, must support the final

cost of Rs. 1 Lac

The Decisions were:

Establish factory in a tax free zone.

Get the tax advantages on infrastructure

development.

Get the suppliers to establish base near

the factory.

Get special concessions from State Govt.

In short select a manufacturing location

where all the advantages could be

achieved.

In short select a manufacturing location

where all the advantages could be achieved.

Total sales estimation


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Now the question was, how much to

produce

It was estimated that the demand for the

peoples car shall be at least twice the

demand for Maruti 800, the lowest end

car. Initial projections were at about 500

K cars per year.

The basic reason was the conviction that

the target price shall redefine the 4 -

wheeler segment.

The price decision of Rs 1 lakh is

definitely going to make a lot many

people transit to 4-wheeler fold and that

shall explode the demand.

F only 10% customers of 9 Million two

wheeler market transit to 4-wheelers it

shall amount to 50% of the passenger

car market share.

It was decided to set up plants with 5

lacs cars per annum capacity and ramp


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the same up in stages, in line with

increase in market demand.

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.


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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.


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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


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THE CAR COSTS Rs 1 lac

Test Marketing And Commercialization

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.

Some myths about Nano

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, its 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


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Nano is an unsafe car

The car has an all steel body.

It meets the mandatory Frontal Impact requirements.

It also meets the Side Impact requirements although

they are not mandatory in India.

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.

It has lower carbon footprint, 20 mg / Km of Carbon

Dioxide emission as compared to 45mg / Km, emitted

by most of the two wheelers.

Its Multi Port Fuel Injection system is controlled by an

intelligent Bosch Engine Management system which

controls the combustion cycle precisely to ensure

compliance to all emission norms.


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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 thecar 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.

The mono volume design and the wheels having been

put at the corners have freed up lot of in- cabin space

and although the car may be registered as a four-

setter, three slim adults can sit comfortably at the

rear.


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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

Its very difficult for a rear - engine car towork.

Rear engines work in many cheap as well as

expensive cars.

Auto-rickshaws at one end and Formula One cars on

the other extreme all use rear engines.

Maruti Omni too has a rear engine, under the seat and

no one has been burnt due to that.

Cooling is easier in Nano as compared to some vans

and there are the air ducts on either side behind the

edge of the doors, which allow air to seep in for both

cooling & for intake.


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Myth no 7

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.

Myth no 8

Cutting Corners is evident everywhere

Cost cutting is done by smart designing rather than

taking out the essentials.

One wiper has been taken out but the functionality is

intact. Wind shield washer fluid jets are mounted on

the wiper itself rather than the body.

Wheels are held by three bolts instead of four.

On the contrary, MRF tubeless tyres and all

Alumininium engine, have been used, which are more

expensive than conventional ones.


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TATA NANO V/S MARUTI 800

Competitor

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.

The real question arise who will have the last

laugh Tata or Maruti 800?


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The answer is neither Tata nor Maruti 800

but they are the buyers who will have the last laugh

Can Nano beat the popularity of Maruti 800. All the things

depend on their marketing strategy that how they will

attract to Indian middle class customers.

Never mind the fact that what was touted as

a Rs.100,000 car will cost at least a fifth more and that's

for the standard non-air conditioned version.

Jagdish Khattar, a former head of Maruti 800 manufacturer

Maruti Udyog Ltd, says it's too early to say whether the

Nano will overtake the original.

"It's a 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," he said while watching a live

telecast of Tata's press conference after unveiling of the

Nano. But clearly, at least one other manufacturer was

worried.

Whether or not the Nano will overtake the

Maruti 800, one thing is for sure: the current Auto Expo will

be remembered for Tata's people's car and for that

product alone. It is the Nano that has captured the hearts

and minds of a majority of the spectators.


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Price of Maruti in major city of India 800 (a/c LPG)

(Figures in rupees)

TATA NANO V/S MARUTI 800

FEATURES OF TATA NANO COMPRAED TO MARUTI 800

COST:

Mumbai 245648

Delhi 228858

Bangalore 231407

Kolkata 236826

Lucknow 232542


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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:


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Maruti 800 petrol/LPG

Nano : petrol (diesel version will be later)

SEATING CAPACITY:

Maruti 800: 4+1 person

Nano: 4+1 person

FUEL TANK CAPACITY:

Maruti800 : 28 Lt (petrol), 19.2 (LPG)

Nano: 30 Lt.

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


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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 NanoLength 3.335 meters

(131.3 inch

3.1 meters

Width 1.440 meters

(56.7 inch)

1.5 meters

Height (55.3 inches) 1.6 meters

BREAKS:

Maruti800: Front Disk, Rear Drum

Nano: Front Disk, Rear Drum

COLOURS

Maruti 800


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Tata Nano:


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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.

Disadvantages of NANO vs. Maruti 800

1. LPG/CNG version is doubtful.

2. Top Speed will be laser than 800.

3. Space for Language is less.


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Data Collection Methods

The success of any project or market surveydepends 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 Nanoand 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.


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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:

Can be posted, e-mailed or faxed.

Wide geographic coverage.

Relatively cheap.

No prior arrangements are needed.

Avoids embarrassment on the part of the

respondent.

Respondent can consider responses.

No interviewer bias.

Disadvantages:

Design problems.

Questions have to be relatively simple.


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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.

Points kept in mind while preparing the

questioner

Liberal spacing

Length of the questioner is kept normal

Logical Order


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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 its used for the same purpose. The secondary data

sources here in this project are:

Websites

Books


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Various Results Of Analysis In The

Form Of Charts

% of people who are aware of tata

nano

yes

no


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the % of people who are aware of the tatas

new product Nano car is shown with the help of pie chart.

o Here, blue color indicates that people are aware of

tata Nano

o And red color indicates the % of people who are not

aware of tata Nano.

While analyzing the chart, we can know that

only 3% of the total sample population is not aware about

tata Nano. This shows the great effect of media,

newspaper and launching of this product.


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Preferences Of Different Age Group RegardingBuying Of Nano.


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this chart shows the preference of different

age group to buy tata nano when it is launched.

Here on x- axis, no of respondents is given.And on y axis the age group is given.

o Blue triangle indicates willingness to purchase tata

Nano.

o Red triangle indicates that the respondent is not

willing to pruchase it

o And green indicates that the respondent is not sure.

While analysing this chart, we can see that

the young generation is egar to buy the product. While due

to some misunderstandings about tata nano, the oldergeneration doesnt desire to buy it or are not sure about it.


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Preferences Of The Respondents RegardingBuying Of Motor Car, Maruti 800 And TataNano


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this chart shows the preference of the

respondent. The question asked in the questioner was, if

you were to buy one of the following, which would you

prefer. the options given were:

motor bike Maruti 800 tata Nano

by having a glance at the chart, we can see

that majority went for tata Nano. Maruti 800 got very less

votes. This shows a tough time for Maruti in future.

Views about success of Nano


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the question asked here was,do you think

Nano will be successful the options given were

yes no not sure.

Its very interesting to note here that none of

the respondent said that Nano wont be successful. As

shown in the chart, the portion of purple color which shows

failure is not there at all.

But again every body does not believe in its

success. As seen form the chart, 50% of the respondent

has a doubt about success of Nano.

Nano- A Peoples Car !!!


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in this chart, number of respondents is given

on the y axis and some features are given on x- axis.

The question asked here is, What is it that

makes Nano a peoples car?

By analyzing the chart, we can say that

people consider the cost factor the most for Nano followed

by the innovation. Even looks has got quite positive reply.

Nano is a product that is developed perfectly at minimum

cost without sacrificing the quality.

Some Feedbacks Based OnQuestioner:

Positive Response

I have one more angle to look at Nano. I think it is

worlds most hyped about gadget after the iPhone. Did

I just say gadget. Well, yes Tata Nano is not just acar; one can also look at it like an expensive gadget

which also gives us mobility. One of the very few cute

looking gadgets that all us geeks will love, who would


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generally be interested in stuff that is sleek and

powerful. I am also hopeful that Tata will launch FCV

and alternative fuel cars soon.

I definitely would like to buy the car. Who would not

want a good car for just 100000 Rs?

Its just cool. One should definitely buy it.

Cheap As it is, but very smart and sexy. I would

defiantly buy it.

Congratulations to Mr. Rattan Tata. He did a real good

job.

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.


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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.

It shall never meet the emission norms. We shall

choke on the poisonous emissions from this car.

The disbelief kept piling up and up and was

further compounded by the competitors adding their

own mite to the speculations.

Mixed Response


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IT HAS NOT BEEN DONE EVER. Even the nearest car is

double the cost. Let us see what Mr. Tata can do tomaintain 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.


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Conclusion

MY OPINION

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 on Sunday

Someone who is looking for long drives.

But Nano Car Is Defiantly For

Someone who is looking to buy a car but cannot afford

much price.

A students who want to go college, tuition instead of

bike etc.


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Someone who depends on second hand car.

For a house wife who can buy a car with her own

savings.

Someone who depends on scooter.

So Nano is not a basically a luxury cars but it

can fulfilled the all capacity for middle class people.

Impact Of Tata Nano On Life Of Common Man

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.


74/74

tata has succeeded in value engineering of

the product and its great success for tatas. Its

something on which India can feel proud of. Nano has

been developed effectively.

nano- new product dev

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