The document discusses the process of new product development. It begins by defining tangible and intangible products. It then outlines the different stages of new product development: idea generation, idea screening, concept testing and development, marketing strategy, business analysis, product development, test marketing, and commercialization. It also provides an introduction to Tata Motors, describing the company's history and products. It specifically discusses Tata's Nano car project to create an affordable "People's Car" priced at around Rs. 1 lakh.
Marketing strategies in automobile industry in indiaRaagini m
EXECUTIVE SUMMARY
Marketing is the action or business of promoting and selling products or services, including market research, strategies, advertising, etc.
Indian Automobile Industry is one of the largest in the world. It contributes to 7.1% of country’s GDP.
In this research, the marketing strategies that are taken up by the automobile manufacturers to grow and sustain in the Indian Market is discussed. This research is secondary in nature. For this purpose, two of the leading automobile companies are taken – Tata Motors Ltd and Hyundai Motors India Ltd (HMIL).
3 major criteria are taken to carry out this research:
a) 4P’s of Marketing
b) SWOT analysis
c) Pest Analysis
Conclusion – Tata Motors is in a better position than HMIL due to the following reasons:
Tata has a well-established brand name
It is almost in all segments of the automobile market.
It is socially more active and giving than HMIL
Marketing strategies in automobile industry in indiaRaagini m
EXECUTIVE SUMMARY
Marketing is the action or business of promoting and selling products or services, including market research, strategies, advertising, etc.
Indian Automobile Industry is one of the largest in the world. It contributes to 7.1% of country’s GDP.
In this research, the marketing strategies that are taken up by the automobile manufacturers to grow and sustain in the Indian Market is discussed. This research is secondary in nature. For this purpose, two of the leading automobile companies are taken – Tata Motors Ltd and Hyundai Motors India Ltd (HMIL).
3 major criteria are taken to carry out this research:
a) 4P’s of Marketing
b) SWOT analysis
c) Pest Analysis
Conclusion – Tata Motors is in a better position than HMIL due to the following reasons:
Tata has a well-established brand name
It is almost in all segments of the automobile market.
It is socially more active and giving than HMIL
Asian Paints - Strategies, Entry Mode, StructureTony Sebastian
This PDF file include the Strategies followed by Asian Paints world wide. It also includes the structure of their organisation and how they enter into other countries in a global perspective
Business Simulation Game - BharatiyaSiMSBharatiyaSiMS
BharatiyaSiMS is an interactive & competitive 2 day online/on-site workshop that reflects challenges of managing real-life business in a fiercely competitive Business world.
(for more info visit http://www.BharatiyaSiMS.com)
Hi All, We have analyzed the positioning of Tata Nano (Kellogg School of Management Case Study)... We have looked into the current sales trends as of 2015... We have proposed an unique positioning... Hope you will appreciate.
The Research is aimed at the study of Royal Enfield Brand in Indian Markets – So far how they have performed and suggestions for them to grab more market share and be profitable. Every year, they have sold modest numbers but despite low numbers, they continue to command a position of respect and awe in the Indian motorcycle market. The objective of the study was to study the different product lines, marketing strategy and Brand Management of Royal Enfield Bullets in Indian market.
1. Bullet riders are mostly Value-Expressive, with an internal locus of control and a strong sense of independence.
2. The company has been cashing in on the iconic status it has and has done little to reinforce its image amongst an exploding two-wheeler market.
3. The pricing of the motorcycle might also be looked upon as conservative.
Royal Enfield has for a while now targeted the youth market with lure of freedom. However, they have done little to reinforce their position. Maybe advertising campaigns targeted at the Value-expressive customer would enable the brand to reap the benefits of its iconic position in a much more productive way. Also, most users find it imperative for the company to improve its After Sales Service and Spares availability.
Asian Paints - Strategies, Entry Mode, StructureTony Sebastian
This PDF file include the Strategies followed by Asian Paints world wide. It also includes the structure of their organisation and how they enter into other countries in a global perspective
Business Simulation Game - BharatiyaSiMSBharatiyaSiMS
BharatiyaSiMS is an interactive & competitive 2 day online/on-site workshop that reflects challenges of managing real-life business in a fiercely competitive Business world.
(for more info visit http://www.BharatiyaSiMS.com)
Hi All, We have analyzed the positioning of Tata Nano (Kellogg School of Management Case Study)... We have looked into the current sales trends as of 2015... We have proposed an unique positioning... Hope you will appreciate.
The Research is aimed at the study of Royal Enfield Brand in Indian Markets – So far how they have performed and suggestions for them to grab more market share and be profitable. Every year, they have sold modest numbers but despite low numbers, they continue to command a position of respect and awe in the Indian motorcycle market. The objective of the study was to study the different product lines, marketing strategy and Brand Management of Royal Enfield Bullets in Indian market.
1. Bullet riders are mostly Value-Expressive, with an internal locus of control and a strong sense of independence.
2. The company has been cashing in on the iconic status it has and has done little to reinforce its image amongst an exploding two-wheeler market.
3. The pricing of the motorcycle might also be looked upon as conservative.
Royal Enfield has for a while now targeted the youth market with lure of freedom. However, they have done little to reinforce their position. Maybe advertising campaigns targeted at the Value-expressive customer would enable the brand to reap the benefits of its iconic position in a much more productive way. Also, most users find it imperative for the company to improve its After Sales Service and Spares availability.
INTRODUCTION
In order to stay successful in the face of maturing products, companies need a continuous stream of new ideas successfully developed into new products. The way to obtain new products is to have a structured and carefully executed new product development process (NPD).
But companies face a problem: Although they must develop new products, the odds weigh heavily against success. Among thousands of products entering the process at the top, only a handful eventually reach the market. Therefore, it is of crucial importance to understand consumers, markets, and competitors in order to develop new products that deliver superior value to customers.
In other words, there is no way around a systematic, customer-driven new product development process for finding and growing new products. We will go into the eight major steps in the new product development process.
Real estate is "property exist of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this an item of real property,buildings or housing in general.
New product development, types of new product, new product line, product line extensions, improvements and revision to existing products, re-positioning, cost reductions.
The New Product Development ProcessBecause introdu.docxcherry686017
The New Product Development Process
Because introducing new products on a consistent basis is important to the future success of many organizations, marketers in charge of product decisions often follow set procedures for bringing products to market. In the scientific area that may mean the establishment of ongoing laboratory research programs for discovering new products (e.g., medicines) while less scientific companies may pull together resources for product development on a less structured timetable.
In this PowerPoint slide show, we present a process comprising the key elements of new product development. While some companies may not follow a deliberate step-by-step approach, the steps are useful in showing the information input and decision making that must be done in order to successfully develop new products. The process also shows the importance market research plays in developing products. We should note that while this process works for most industries, it is less effective in developing radically new products. The main reason lies in the inability of the target market to provide sufficient feedback on advanced product concepts since they often find it difficult to understand radically different ideas. So while many of these steps are used to research breakthrough ideas, the marketer should exercise caution when interpreting the results.
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New Products are vital
As the cartoon highlights, in this era of rapid changes in our external environment, innovation is imperative. A firm cannot rest on their laurels (and current products). Furthermore, the time it takes firms to bring new products to market has accelerated. Firms that fail to develop new products put themselves at risk as their existing products are vulnerable to changing customer needs and tastes, new technologies, shortened product-life-cycles, and increased competition. In this PowerPoint slideshow, we highlight the 8 step new product development process as described by Kotler and Keller (2016).
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8 Step New-Product Development Process1. Idea Generation2. Idea Screening3. Concept Development and Testing4. Marketing Strategy Development5. Business Analysis6. Product Development7. Market Testing8. Commercialization
How Kotler and Keller (2016) describes the New Product Development Process is as an eight stage process in which the new product can be dropped at any time. Other sources will condense some of the steps so you may see others refer to fewer steps. If you look at these closely though, they are not deleting any of the activities, but instead are combining some of them.
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Step 1: Idea GenerationAt this stage marketers need to ask: Is the idea worth considering?If yes, proceed to idea screening.If no, drop.Ideas for new products can come from:Customers and channel membersScientists and engineersBy examining competitorsTop management
The first step of new product development requires gathering ideas to be evaluated as potential product ...
Similar to 18340710 a-study-on-new-product-development-with-tata-nano-and-comparitive-study-on-maruti-800 (20)
2. Introduction To New Product
Development
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
2
3. New Product Development:
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
3
4. 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 competitor’s products
and services. They can find out what the customers like or dislike about
their competitor’s 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
4
5. 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.
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.
Company’s ability to produce and market the
product.
Buying behavior and the probable changes in the
environment.
5
6. 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.
Concept Testing And Development:
All ideas that survive in the process of screening will be studied in
details. They will be developed into mature products. At this stage, the
idea is submitted for the external evaluation to get a feedback from the
market. It helps a firm are organization to collect important information
like customers initial reactions towards the product development. During
this stage, new product idea is described in the form of one or more
benefit that is then presented to a sample of potential customers for their
reactions.
Marketing Strategy:
Following a successful concept test, the new product manager will
develop a preliminary strategy plan for introducing new product in the
market. The plan consists of three parts.
The first part describes the target market size, structure and
behavior for the first few years.
6
7. 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 at this stage by the organization. It also includes the
following:
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.
7
8. The R&D, manufacturing, marketing and financial departments
estimates the costs. The profitability of 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.
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 is
developed 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.
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:
8
9. 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.
After successfully laughing the product in selected cities the company
launches the new product in all other cities.There are certain methods of
product testing.
Alpha Testing
In this method, a group of target audience is selected from the employees
of the company.
Beta Testing:
9
10. It is carried out at the customer’s site. Generally, it is applicable for
industrial products where the customization takes place.
Gamma Testing:
It is carried out on a long term basis where the customers uses the
product extensively and gives response after a long period of time. Say
six months.
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.
Introduction To Tata Motors:
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.
10
11. 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
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
“People’s 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 didn’t grab the attention of only
Indians; the entire world had their eyes glued to the world’s cheapest
car.
11
12. A truly People’s 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 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
12
13. 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
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.
13
14. 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
SOWT Analysis
STRENGTH Fuel efficient
Brand name TATA Safe
Cost price low OPPORTUNITIES
14
15. Large market for First car in low
selling range
Awareness in the Can hit in global
market 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
15
16. New Product Development And Nano
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.
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
17. 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 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-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,
18. 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 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?
19. 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."
20. 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?
21. 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
22. 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
23. 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
24. 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 diagramThe design has to question the need of each and 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:
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.
25. 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.
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.
26. 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
Now the question was, “how much to produce”
27. It was estimated that the demand for the people’s
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 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
28. 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
29. 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.
30. The Final verdict
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.
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?
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
31. 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.
Price of Maruti in major city of India – 800 (a/c LPG)
(Figures in rupees)
Mumbai 245648
Delhi 228858
Bangalore 231407
Kolkata 236826
Lucknow 232542
32. TATA NANO V/S MARUTI 800
FEATURES OF TATA NANO COMPRAED TO MARUTI 800
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:
33. 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
FUEL TANK CAPACITY:
Maruti800 : 28 Lt (petrol), 19.2 (LPG)
Nano: 30 Lt.
WEIGHT
34. 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 meters (131.3 3.1 meters
inch
Width 1.440 meters (56.7 1.5 meters
inch)
Height (55.3 inches) 1.6 meters
36. 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
37. 1. LPG/CNG version is doubtful.
2. Top Speed will be laser than 800.
3. Space for Language is less.
Views about success of Nano
the question asked here was,”do you think Nano will be successful” the
options given were yes no not sure.
38. It’s very interesting to note here that none of the respondent said that
Nano won’t 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 People’s Car !!!
39. 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 people’s 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 .
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.
40. 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.
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.
41. 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.