Tata Nano

Nano Strategy

Presented By,

Pratik Purav P-29

Aditi Sabaria C-31

Rohit Mundhara P-21

Saurabh Shinde P-35

Strategic Management

• Automobile industry in India

• An embryonic automotive industry emerged

• Japanese manufacturers entered

• Industry today

• Major Players in India

INTRODUCTION

To develop TATA into a world class

Indian car brand for innovative

and superior value vehicles

VISION

• To be the most admired multi-national Indian

company producing vehicles that people love to buy

• To create an organization that people enjoy

working for doing business with and investing in

Mission

“I saw families ridding around on scooters with kids standing up and mother carrying a baby

and sitting Pillion and decided to do something about . It started as an quest for an

affordable transportation solutions.”

.

Idea Generation Of Nano

Source – Business Standard

TATA’s NANO

Why

Nano ?

A Promise is

A Promise – Ratan Tata

SWOT Analysis

Strengths

PriceMileageStyleBrand NameFirst Innovation

Fiber Body Low Suspension Light Weight Not Suitable for Hilly Areas Delay due to Singur

Weakness

• Bikers can be motivated

• Auto rickshaw & second hand market

• Other competitors

• Traffic Congestion

• New Regualtions

Opportunities

Threats

Strategy

• Time honored International strategy• Effectively used parliamentary politics as business strategy• Politics shaping Nano’s future• Earlier less reliance on states

• Considered government as a regulator• Ratan Tata changed the group’s attitutde• Involved the state as partner• Relationship between state and group improved

Location of Manufacturing Plant

• TML intending to set manufacturing plant• Considered locating plants in various states• Accurate understanding of :– Political interests Compulsion of State Government

Contd..

• Exploited such weakness to its advantage• Incentive package in Uttarakhand/Himachal Pradesh a)100% exemption from excise duty for 10 years b)100% exemption from Corporate Income tax• WB out of desperation walked into the trap

Singur - Tata

• Govt. WB keen for rapid industrialisation• Approached Tata Motors• Tata Motors showed interest in locating the plant in WB• Chose Singur a small town in Hoogly district of WB• Govt. WB provided TML a loan of 200 crores at 1%

interest

Tata enjoying the most of incentives!!!

• A comprehensive package of incentives• Electricity Clause – Electricity at Rs.3kwh• Loan Repayment – Loan with interest repayable in annual installments• Lease rental

Why Tata Nano pulled out of Singur?

Political Battlefield

Land Controversy

• Acquired Land• Compensation

• Misunderstanding

• Admitted Mistake

“Great agitation and

great aggression”

“You cannot run a plant where the wall is being broken; you cannot

run a plant where bombs are being thrown from all the sides; you

cannot run a plant where the people have been intimidated or

threatened. This is only during the construction, what happens

when we actually start running the plant!”- Ratan Tata

Chairman,Tata Motors Ltd

FRONT LINE ,Volume 25 - Issue 22 :: Oct. 25-Nov. 07, 2008. INDIA'S NATIONAL MAGAZINE

Corporate Rivalry ?

Destructive Politics...

“I once mentioned that if somebody puts a gun to my head, you

either pull the trigger or take the gun away because I will not

move my head. I think Ms.Mamta Banerjee has pulled the

trigger,”- Ratan Tata

Chairman,Tata Motors Ltd.

FRONT LINE ,Volume 25 - Issue 22 :: Oct. 25-Nov. 07, 2008. INDIA'S NATIONAL MAGAZINE

Effects on West Bengal

• Brand Image• Damages to the Public property• Losses beared •Unemployment

Effects on Tata Motors

• Tata Gained a Seven Crucial Months - Commodity Prices declined - Advances - Mobilise the Funds

Fight for Nano Begins – Again• West Bengal’s loss another State’s gain

• Karnataka 1st to offer

• Gujarat offered 3 strategic locations

- Mundra in Kutch district

- Charodi in Sanand

- Surat

• Orissa offered land at Gopalpur

• Maharashtra, Andhra Pradesh, Uttarakhand also made an offer

Winner - Gujarat

• Reliable Infrastructure• Locations - Government owned land• Charodi and Chharal villages in Sanand the ultimate choice

“You are stupid if you are not in Gujarat” - Ratan Tata

Vibrant Gujrat

Benefits to Loan of Rs 9,570 crores

THE DEAL

Rs 2,900 cr for Nano plant

Rs 6,670 cr for Infrastructure development

Repayment of Rs 9,570 cr loan @ 0.1% over 20 years

• 100% exemption on electricity duty

• Concessional power tariff

• 1,100 acre land comes cheap

• No stamp duty, Registration and transfer charges

• Payment for land in 8 equal annual instalments

THE SWEETNERS

• Benefits to Component manufacturers and Vendors• New Investment opportunities and positive sentiment in Gujarat • Benefit to Real estate market• Additional jobs and training opportunities

Benefits to Gujarat

Win-win situation

Bibliography/Webliography

• "Specifications of Tata's Nano". indiatimes.com. 2008-01-10.

• "Nano Mania". Autocar India. February 2008.

• "Specifications of Tata's Nano". cardesignnew.

• "Review of Tata Nano" TechWebToday.

• Falling Rain Genomics, Inc - Singur

• "Census of India 2001: Data from the 2001 Census, including cities, villages and towns (Provisional)". Census Commission of India. Archived from the original on 2004-06-16. http://web.archive.org.

• The Hindu Business Line, 26 November 2006

• The Hindu Business Line, 13 December 2006

Questions ?

Thank You