Date: November 21st, 2014

Prepared For: Md. Rashedur Rahman

Assistant Professor

Department of International Business

University of Dhaka

Prepared by:

ASM Towheed: 801312006

MD Miraz Hossain: 801312005

Kawsar Ahmed: 801312025

Elevator pitch: The case is based on the Inception of India’s one of the most successful business

entrepreneurs, with an astonishing accumulated revenue of $14 Billion, the legendary creator of

Tata Nano car; world’s economical family car that is ever built! It gives us a view that, despite all

the barriers of mechanical ambiguities, position of property, complex functionality and extremely

low profit margin; a business can move on the right track if support is ensured. We feel the

channeled for Tata Nano is to keep up the interest on their car, provide after sale service and

develop further to increase sales in national and international market as they were able to do

before launch.

1. For the last half century, Tata’s strategy has rotated around a deep understanding of the

implications of economic factors, and how that can be translated into desirable customer

products. To achieve this, Tata depends on cutting edge technology. In the case of the Nano,

Tata recognized that very few attempts had been made to serve the large customer

segment at the bottom of the pyramid in emerging markets. By developing an inexpensive

car, Tata could attract consumers who were relegated to riding scooters and motorcycles.

Tata felt that a car was a far superior option to two wheeled transportation especially for

families concerned with safety and comfort. Tata believes that the Nano could increase the

pool of prospective buyers in India by 65 percent.

2. Tata began its design process for the Nano by first figuring out what its target customers

could pay for a car, and then working backward from that price. The company’s innovative

approach required the ability to “think outside the box” and challenge many of the more

traditional approaches to design and manufacturing. Tata identified the basic features that

customers required in a car, and then asked its engineers and suppliers to develop a car

with those specifications that would also meet the $2,500 final price tag. Tata recognized

that certain features were not necessary for its target market, and so eliminated those in

order to incorporate necessary safety and quality features. The Nano contains a smaller

engine for example, since the ability to drive at higher speeds is unnecessary in India’s

crowded cities. The company also used an innovative kit approach that allows it to construct

components and ship them separately to be assembled in multiple locations.

3. Tata had initially planned to manufacture the Nano at a newly built plant in Singur, West

Bengal, India. However, after purchasing what it had thought was government owned land,

Tata discovered that the West Bengal government, in an effort to attract Tata, had actually

acquired the land from local farmers by imposing eminent domain. The farmers protested

the process accusing Tata of forcing them from their land. The farmers claimed their

compensation was only a fraction of the land’s real value. The dispute caught the attention

of other activists and resulted in some 30,000 people rallying against the plant. Tata,

worried that the dispute would not come to a satisfactory conclusion, decided to relocate

the plant to a new city. The disputes ultimately cost Tata delays of at least six months.

4. Nano has changed the world auto industry. In a manner similar to Volkswagen, Tata has

shown the industry that a market exists for basic transportation at a low cost, especially in

the emerging markets where some believed that many people simply could not afford a car.

Tata demonstrated that being innovative and thinking outside the box are important to

companies as they approach these new markets, and indeed, even markets in developed

countries. In addition, Tata has stressed the importance of thinking into the future and using

today as a platform for tomorrow.

5. Nano could be a big seller in other emerging markets, but perhaps not in the developed

countries. The small size of the car and its lack of comfort features will make it less

attractive to U.S. consumers, however, others may argue that U.S. consumers have shown a

willingness to try new things such as the Smart Car, and the Yugo, the very inexpensive car

that Yugoslavia introduced in the U.S. in the 1980s. The perception that low cost equals low

quality will be important to overcome as Tata introduces the car to developed country

consumers, and that the company must find ways to convince consumers that the Nano has

passed or exceeded all safety requirements in these markets. Tata can take a page from

Hyundai as it makes its case on quality to U.S. consumers. Tata could also build on its

ownership of Jaguar and Land Rover, two names associated with performance, luxury, and

quality.

Appendix:

1. Tata Engineering and Locomotive Co. Ltd. Was established to manufacture locomotives and

other engineering products: 1945

2. Research and Development Centre set up at Jamshedpur: 1959

3. Exports begin with the first truck being shipped to Ceylon, now Sri Lanka: 1961

4. Setting up of the Engineering Research Centre at Pune to provide impetus to automobile

Research and Development: 1966

5. First commercial vehicle manufactured in Pune: 1977

6. Production of first light commercial vehicle, Tata 407, indigenously designed, followed by

Tata 608: 1986

7. One millionth vehicle rolled out: 1991

8. Mercedes Benz car E220 launched: 1995

9. 2 millionth vehicle rolled out, Indica, India’s first fully indigenous passenger car, launched:

1998

10. 3 millionth vehicle produced: 2003

11. Fiat Group and Tata Motors announce establishment of Joint Venture in India: 2007

12. Tata Motors’ new plant for Nano to come up in Gujarat, Tata Motors unveils its People’s

Car, Nano, at the ninth Auto Expo: 2008