Project report on

WHY DOES INDIA NEED A SMALL CAR

LIKE NANO

Submitted to Submitted by:

Prof. Suruchi SHAZIA TABASSUM
09PGDMO88
SEC-C

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 SMALL CAR MARKET IN INDIA:

India will become the world's largest producer of A-segment small cars by 2013, a
recent study by US-based market global intelligence firm Global Insight reveals. By
2013, India will produce about 31 per cent of the world's A- segment cars.
A combination of key reasons such as technical expertise, low costs, stable economy,
and government policies favouring small cars, large and integrated supplier base, and
competence in diesel power train manufacturing will propel India as a major small car
manufacturer.

Segmentation

1. Geographic

a. Region: The major regions for small car market in India are north, south, and west.
b. Rural/Urban: Since more than 60% of the total population is living in interiors, it
becomes all the more important to cater to this segment. However, so far, the
marketers have laid more focus on Urban/semi urban market and their products are
primarily catering to the needs of the urban segment. But with the recent market hits,
the companies are trying to pay more attention the rural market segment to
gain profits.

2. Demographic

a. Age & life cycle stage: Student, Young Married, Single working. The average age
profile of a car buyer is 25-46 years. Although the percentage of people buying cars
between 31 and 40 years of age has remained stagnant at 31 per cent (1999-03), there
has been a 9 percentage point increase in the number of car buyers in the 25-30 age
groups. The number of older people (51 to 60 plus) buying cars has gone down.

b. Family Size: Average Indian household size is 5 people. Hence Small cars are the
most obvious and
Affordable choice available for the Indian middle class.

c. Income: Higher income households tend to be less price-sensitive, placing a higher

value on buying higher-quality merchandise. Because of the growth in dual-income
households, there has been a dramatic growth in the proportion of total spending in the
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economy coming from such households, implying that the market for high-end
products and services should increase substantially. Thanks to the easy availability of
cheap financing options, there has been an increase in the number of younger people
buying cars in India during 1999-2003EMI: a factor affecting the most of the buyers. 3
out of the 4 cars sold in the country are funded by a loan.

d. Benefits: Consumer looks for the following benefits from a car.

i. Power: People do look for power from power. According to their need they look for
cars in
their respective power basket (i.e. 600cc – 1300cc). A higher power is related to give
higher
speed, acceleration by the consumers.
Distribution of households (owning a car) by income
Distribution of household (owning a car) by literacy%
ii. Technology: With all sort of products available in the small cars market, technology
can act as
a differentiator for consumer. New technologies such as MPFI (multi point fuel
injection), turbo charging, electronic traction control, anti locking braking systems,
and catalytical convertors.

iii. Fuel Economy: People do look for better fuel economy in terms of mileage given
by the car.
Preferred Fuel: With the rise in petrol prices, people have been looking for alternatives
such
as diesel, CNG, LPG. Many car buyers in India prefer the diesel variant whatever may
be the
choice of car, because of the favourable cost differential diesel.

iv. Low operational cost: For some of the users, operational cost is a major factor in
deciding
the buying decision. Operational cost includes Maintenance cost, insurance cost, spare
parts,
cost of service.

v. Space and comfort: Buyer does look for spacious and comfortable ride. Various
factors in deciding comfortable ride are leg room, head room, driving position,
adjustable steering.

vi. Safety: the most important factor for family buyers is the safety feature of a car. A
car must

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follow safety norms, various safety features which people look in car are ABS,
airbags.

vii. Styling: To certain buyers, functionality was not everything, looks were also
important. They
wanted styling, and contemporary looks.

viii. User Status: The kind of buyer can be classified into non-buyer, first time buyers,
and repeat buyers. The major of the buyers in the small car are a first time buyer,
that’s why this market is often referred as entry level car market. While going for car
replacement, 50 percent of small car owners in India are again going for small cars
and are reluctant to experiment with luxury cars.

Positioning:

Small cars have been positioned in India as city cars, which are easy to drive, give
high mileage, with low operational cost and low price. Because of the tremendous
growth in the small car market, various global car manufacturers are entering this
market and thus leading to growing competition. This has further led to each
manufacturer positioning it, better than the rest; by upgrading products, several
versions, new technology giving discounts & offers, better financing options.If we
look at India, we have about one billion people growing at about 17-18 million a year.
We have a middle class or a consuming class of about 250 million, which is increasing
from the bottom up each year. And we have a higher percentage at the top of the
pyramid, which has been the buying public hitherto for most Indian products.There is
also a segment of the market that is brand conscious, prestige-conscious and would
often even prefer to buy foreign brands to Indian brands. They know what is
happening elsewhere in the world and would prefer to put their money on a foreign
brand rather than an Indian bran

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 NEED OF SMALL CAR LIKE NANO IN INDIA

As urbanisation gathers pace, personal transport has become a big issue, especially
since mass transport is often not available or is of poor quality. Two-wheelers - with
the father driving, the elder child standing in front and the wife behind holding a baby
- is very much the norm in this country. In that form two-wheelers are a relatively
unsafe mode of transporting a family. There is need of a car which can effortlessly
manoeuvre on busy roads in cities as well as in rural areas. Gone are the days when
buying a small car meant choosing between a Maruti 800 and a Zen. In the Indian
market brimming with choices, buying a small car can be quite a trial. Forget first-
time buyers, even those hunting for a change of car are left confused in a market full
of small cars, where each manufacturer is competing for your money. In today’s world
a car is needed which is stylish, has enough space for your family of four, is fuel-
efficient, has low running costs, is backed by a network of easily accessible service
stations, and one that would fetch good resale value five years down the line. Nano
thus brings the joy, pride and utility of owning a car to many families who need
personal mobility. Thus there would be a very conscious shift with the launch of this
product from the two-wheelers space to an upgraded product choice by the consumers

 Tata Nano is the latest and cheapest car which is within the reach of middle
class family. It is designed with the accommodation of four persons with
comfortable leg-space. It is manufactured with all metal body and Aluminium-
sheet. It is a car of tube less tyres. It maintains lower pollution level than two
wheelers. Its performance is controlled by an especially designed-system.
TATA NANO will usher a new era in the history of Auto-mobile Industry

 TATA Nano,- AS the name indicates nano means smallest, with a brand name
attached with TATA, Mr. Ratan Tata gives Indian market new trend with a
lowest price passenger vehicle with unique technique and all the necessary
features. Nano goes wider market throughout the world. The main aspect behind
that is to change the market flow regarding high price market to low price which
is beneficiary to all the middle class & lower class society. All middle class &
lower class society achieve their dream after buying TATA NANO.

 Despite the grimness of the current economic climate, all is not lost. In fact, the
Tata believes the global economic downturn is a great opportunity for it to
leverage its space in the market, because there is no better time for buying cars
like the Nano. With this in mind, it has not even slightly slackened the pace of
its efforts in setting up the Nano plant

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 This is the right time for the Nano to make an impact on the global auto industry
when the entire globe is under the grasp of recession. Experts view that the
slowdown in developed countries (including the West and Japan, and to a lesser
extent, South Korea) will push up sales for inexpensive car options, like the
Tata Nano, in the developing economies. With the major American car
companies unable to sustain their sales in the developing countries during this
troubled scenario, the focus of most consumers in the developing nations will be
on cheaper and more fuel-efficient, home-grown cars. As the demand for these
cars increases in the developing economies, the sales of high-end cars (many are
imported as CBU from developed countries) are likely to dip significantly. With
pockets that are not too deep, this segment is certain to fulfil the needs and
demands of the middle class consumers. Moreover, the Nano is pitched as a car
that can fill the need of families that want to graduate from two wheelers.

 All these give the Nano the best chance to become the master of the roads of
developing countries. With more people opting for this brand (assuming its
technological finesse), the demand for sophisticated, albeit oil-guzzling cars
from the developed countries is sure to decline. This will drive the car majors
deeper into their woes. Experiencing this, they may take the cue from the Nano
and come out with smaller and more fuel-efficient cars that will tailored their
conditions. But given the economic condition they are in, this kind of massive
restructuring is difficult to contemplate. One thing is certain for now - the Nano
is sure to cut into bigger car companies' sales in India and other developing
markets. When the requiem is sung for these relatively more expensive cars, the
coffin bearer will be the Nano.

 The pollution it will cause will be lower than 2-wheelers."

The Nano is smaller than a Maruti 800, but has 21 per cent more volume or
space inside than the Maruti 800. The dealer price of the car will be Rs 1 lakh,
plus value-added tax (VAT) plus transport charges. The car's dashboard features
of Nano are it just have a speedometer, fuel gauge, and oil light. The car does
not have reclining seats or radio. The shock absorbers are basic. The lightweight
car has only one windshield wiper instead of two.

 It will sport a 30-litre fuel tank and 4-speed manual gearshift. Nano has a 624cc
engine and a mileage of 23 km per litre but will have no power steering. It will
have front disk and rear drum brakes. The car will be available in three colours

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 Red, Yellow and Silver.

 The Nano, designed with a family in mind, has a roomy passenger compartment
with generous leg space and head room. It can comfortably seat four persons.
Four doors with high seating position make ingress and egress easy. Mr.Ratan
Tata's Nano fulfils common man's dream. It fulfils the need of the common
Indian who aspires to move from a two-wheeler to a four-wheeler.

INTRODUCTION ABOUT TATA

NANO

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On March 23, the day Tata Motors launched the Nano -- its long-awaited small car
priced at US$2,000 is a engine, four-passenger city car built by Tata Motors, aimed
primarily at the Indian market. It is the cheapest car in the world today.
It debuted in late 2008 at the 9th annual Auto Expo at Pragati Maidan in New
Delhi, India, and started to be delivered to customers in July, 2009.

In 2008 the Financial Times reported: "if ever there were a symbol of India’s

ambitions to become a modern nation, it would surely be the Nano, the tiny car with
the even tinier price-tag. A triumph of home-grown engineering, the $2,200 (€1,490,
£1,186) Nano encapsulates the dream of millions of Indians groping for a shot at urban
prosperity." "It led me to wonder whether one could conceive of a safe, affordable, all-
weather form of transport for such a family.

'Family transport'

Mr Tata had 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
. It led him to wonder whether one could conceive of a safe, affordable, all-weather
form of transport for such a family the two-wheeler image is what got him thinking
that he needed to create a safer form of transport. His first doodle was to rebuild cars
around the scooter, so that those using them could be safer if it fell, thus "Tata Motors'
engineers and designers gave their all for about four years to realise this goal.

"Today, we indeed have a People's Car, which is affordable and yet built to meet
safety requirements and emission norms, to be fuel efficient and low on emissions

'People's car'

Mr. Ratan N. Tata, Chairman of the Tata Group and Tata Motors, unveiled the Tata
'NANO', the People's Car from Tata Motors that India and the world have been
looking forward to. A development, which signifies a first for the global automobile
industry, the People's Car brings the comfort and safety of a car within the reach of
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thousands of families. The launch of the Nano was a landmark in the history of
transportation. a safe, affordable and all weather transport - a people's car, designed to
meet all safety standards and emissions laws and accessible to all, the car had passed
emission standards and would average about 50 miles to the gallon, or five litres per
hundred kilometres. The launch of the People's Car by Tata Motors is a defining
moment in the history of India's automotive industry. For Tata Motors, the car -
christened the Nano, because it is a small car with high technology - is the next big
step in a journey that began with the Indica. For the Tata Group, it is the realisation of
a pioneering vision to create a breakthrough product globally that rewrites the rules of
the small-car business. The People's Car, designed with a family in mind, has a roomy
passenger compartment with generous leg space and head room. It can comfortably
seat four persons. Four doors with high seating position make ingress and egress
easy.Nano is in sync with these recessionary times -- low cost, low budgets and lower
spending,
Yet with a length of 3.1 metres, width of 1.5 metres and height of 1.6 metres, with
adequate ground clearance, it can effortlessly manoeuvre on busy roads in cities as
well as in rural areas. Its mono-volume design, with wheels at the corners and the
power train at the rear, enables it to uniquely combine both space and
manoeuvrability, which will set a new benchmark among small cars. The car will be
available in both standard and deluxe versions. Both versions will offer a wide range
of body colours and other accessories so that the car can be customised to an
individual's preferences.

The Nano is a disruptive technology and will have an impact on the auto industry both
in India and the world over; it has the potential to reshape the automotive world. Nano
should teach Detroit auto manufacturers not to be complacent. "It is the lack of desire
to challenge the so-called impossible and the inability to think the unthinkable which
is responsible for the Nano coming from a place like India." It is not about to change
the world, however, "This is certainly not disruptive technology. At best, it is
disruptive pricing."

"Nano is not a disruptive technology, in the sense that it does not bring in a new
method of transportation using breakthrough technology. It is a project that attempted
to create a separate and distinct market segment at a price point that was not available
before it."

Nano is going to radically change car design globally. The drivers are more around
emission technology and safely norms rather than an ultra low cost car.

The Nano is a kind of a disruptive innovation, bringing non-users into the category,
offering a superior value at the entry level as compared to existing offerings; it is a
fine example of the creation of customer value.

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But cost reduction is what consumers tend to associate with the Nano, despite the best
efforts of the Tata marketing team to project it as a "family" car rather than a "cheap"
one.

Tata Nano Basic Specs:

*Can seat four persons

* Length of 3.1 metres, width of 1.5 metres and height of 1.6 metres
* Mono-volume design, with wheels at the corners and the power train at the rear
* Rear-wheel drive, all-aluminium, two-cylinder, 623 cc, 33 PS, multi point fuel
injection petrol engine
* Maximum speed of 60 miles per hour
* Mileage of 50 miles per gallon
* Sheet-metal body

The lean design strategy has helped minimise weight, which helps maximise
performance per unit of energy consumed and delivers high fuel efficiency.
Performance is controlled by a specially designed electronic engine management
system. Tata Nano exceeds current regulatory requirements. With an all sheet-metal
body, it’s supposed to come with a strong passenger compartment and safety features
like crumple zones, intrusion-resistant doors, seat belts, strong seats and anchorages
and rear tailgate glass bonded to the body.

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The People’s Car is supposedly less polluting than two-wheelers being manufactured
in India today.
By the way, Tata Nano’s tailpipe emission performance is said to exceed regulatory
requirements.
When the Tata Nano formally rolls off the assembly lines later this year, it will come
in three models – Standard, Deluxe and Luxury.

Tata Nano Variants:

 

Tata Nano Base Model

Rs. 1,35,151

 
Tata Nano CX
Rs. 1,64,481

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Tata Nano LX
Rs. 1,86,498

Price

Variant Base CX LX

Form Fee 300 300 300

Booking Amount 3199 3799 4299

* Assam, Orissa, West Bengal, Goa - 10

* Punjab, Himachal Pradesh, Haryana,
Chandigarh - 15
* Jammu & Kashmir, Tamil Nadu - 20
* Delhi, Karnataka, Kerala, Pondicherry,
Stamp Duty
Chhattisgarh - 50
* Bihar, Jharkhand, Uttar Pradesh, Andhra
Pradesh, Gujarat, Rajasthan - 100
* Maharashtra - 140
* Madhya Pradesh, Uttarakhand - 700

Car Price Nano price will vary by the city

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ADVANTAGES

 Most people can afford it. People will probably prefer driving this rather than
driving their 2-wheelers. Two-wheelers are quite dangerous especially in India.
The car is small and will fill in small places for parking. Easy to drive, with less
turning radius and easy to park.

 Looks cute and good styling with large interior space. Lower overall pollution
level than two wheelers

 Fuel-efficient engine
The People's Car has a rear-wheel drive, all-aluminium, two-cylinder, 623 cc,
33 PS, multi point fuel injection petrol engine. This is the first time that a two-
cylinder gasoline engine is being used in a car with single balancer shaft. The
lean design strategy has helped minimise weight, which helps maximise
performance per unit of energy consumed and delivers high fuel efficiency.
Performance is controlled by a specially designed electronic engine
management system.

 Meets all safety requirements

The People's Car's safety performance exceeds current regulatory requirements.
With an all sheet-metal body, it has a strong passenger compartment, with
safety features such as crumple zones, intrusion-resistant doors, seat belts,
strong seats and anchorages, and the rear tailgate glass bonded to the body.
Tubeless tyres further enhance safety

 Environment-friendly
The People's Car's tailpipe emission performance exceeds regulatory
requirements. In terms of overall pollutants, it has a lower pollution level than
two-wheelers being manufactured in India today. The high fuel efficiency also
ensures that the car has low carbon dioxide emissions, thereby providing the
twin benefits of an affordable transportation solution with a low carbon
footprint.

 Interior/Exterior design - The Tata Nano has a great design. Looking at the
exterior, the car looks very small. However, on the interior the car has much
more space than its exterior appearance. Very few cars in this world can pull
such a feat off. 

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  Handling - The Tata Nano has it's engine on the back. Moreover it has a rear
wheel drive. As a result, even if there is no power steering, the wheel handling
on the front should not be a problem at all; in fact it probably is much easier
than say a Maruti 800.

 OPTIONS!!! - Tata Nano gives you OPTIONS as compared to other cars. You
have the choice of having air conditioning, or any other features. Unlike other
cars, you are no stuck with these features.

 Support - Tata is considering assembling these cars at local locations. As a

result, a person buying a Tata Nano in Mumbai can bet his car was made in
Mumbai. Hence it will be easy for the person to take the car back to the
dealership and have it fixed in case anything goes wrong.

Technical Specifications
Overview
Make Tata

Model Tata NANO

Body Type Hatchback

Number of Doors 4

Seating Capacity 04 (Four)

Fuel Efficiency

City Mileage 20-25 kmpl

Highway Mileage T26 kmpl

Fuel Capacity 30 litres

Fuel Type Petrol (Diesel Version will be later)

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Fuel Grade -

Fuel Injection Multi Point Fuel Injection (MPFI)

Specifications:

Length 3.1 meters

Width 1.5 meters

Height 1.6 meters

Engine All-aluminium, Rear Mounted, Rear Wheel Drive

Capacity 623cc

Power 33PS

Body Type Sheet Metal

Emission Norms Euro-IV, Bharat Stage-III compliant

Safety Norms Frontal Crash Tested

Versions Standard, Luxury

Gearbox 4-speed manual; Cable operated

Wheelbase 2230mm

Ground
180mm
Clearance

Kerb Weight ~ 600kg

More Extra Features:

Speed Top speed will be 90 Km/hour.

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Colours Red, Yellow and Silver

Pros and Cons of Nano:

The car is quite big when seen close than what one must have imagined seeing those
newspaper pictures. Its impression on first look is really strong and more as cutie, with
it smiley kind of front looks. When entered inside the car has real respect to the
passengers giving ample space not even in front but in rear seats also. The car has all
features a beginner will look for AC, power window(just in front but still okay), Good
looks, Then for youths there’s a space for stereo, and best of all just few bucks above
Yamaha R15 and you can have a good comfort than that. The car is amazing for those
who want to get their first car. 

These were all the goods but there are certain things that strikes when we go though
the car feature first of all when we look at the car what we see first are the two ears of
our cutie i.e. Mirrors they are totally away from the cars body and when we would
come on Indian roads it’s a tough challenge to keep these mirrors safe, considering
nano the mirror is not safe at all.
Its overall very nice car one can buy as his /her first car and it would neatly fulfil all
the basic car needs and to a certain extent some luxury features also

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