Tata Nano

GROUP : 6 SHELZA GUPTA SONIA WALIA SURBHI SHARMA SIDDHARTH GUPTA VIKAS HOODA SAMEER NARANG

TATA NANO DREAM LAND

INTRODUCTION

Chairman of TATA group- Mr. Ratan Tata. In 2005-2006,total revenues of company-

US$21.9 billion. Country’s total GDP in 2005-2006 is $782.14 billion Company’s revenue in 2005-06 2.8% of country’s GDP.

(ie. $21.9 billion) Market Capitalization- US $46.9 billion

TATA’S DREAM

• IDEA GENERATION-I saw families riding around on

scooters with kids standing up and themother carrying a baby and sittingpillion and decided to do somethingabout it. It started as a quest for anaffordable transportation solution”.RATAN TATA

• source:- Business standard

TATA’S DREAM

• Providing a car of Rs 1,00,000 in

Indian Market.• Target segment-middle class families.• He wants to introduce affordable

car in India.• "Nano" derives from the Greek root 'nanos', meaning

dwarf — as with nanometre. • INDICA’S success gave confidence

to Ratan Tata to go with his Dream Car.

FEATURES OF TATA NANO STATED BEFORE ITS INTRODUCTION

Dimensions:

- 3.1 metres (10.23 feet) long, 1.5 metres wide and 1.6metres high.

- Can seat four to five people

Engine: A two cylinder 700 cc, 35 horsepower rear mounted, all

aluminium, multi-point fuel injection petrol engine can power the car to top speeds of 105 kilometres per hour (65 miles per hour).

Fuel Efficiency: - 20 kilometres per litre, or 50 miles per gallon is claimed.

Pollution: - Exceeds Indian regulatory requirements and can meet strict

Euro IV emission standards.

- In terms of overall pollutants, Tata says the car is better than two-wheelers manufactured in India currently

INTRODUCTION TO NEW PRODUCT TATA NANO

Low cost car Large sales volumes targeted Large scale production

STRATEGY ADOPTED BY TATA GROUP

LOW COST ASSEMBLY

OPERATION

WHAT MAKES TATA NANO SO CHEAP

NO AIR CONDITIONING ON STANDARD MODEL WINDOWS WIND

DOWN BY HAND

MANUAL STEERING, NO AIR BAG

PLASTICS AND ADHESIVES REPLACES WELDING

BODYWORK MADE OF SHEET METAL AND

PLASTIC

HOW TATA HAS PLANNED TO REDUCE COST

• Production of high volume parts in 1 plant.• The car was designed at Italy's Institute of

Development in Automotive Engineering which is cost effective.

• ASSEMBLY -CUM- RETAIL OPERATION APPROACH - encouraging local entrepreneurs to invest in satellite

units.

- to assemble all components

- sell and service the assembled vehicles

- Low cost service facilitity

- Eliminating Dealer’s margin

TATA’S SEARCH FOR LOCATION

• Search for best Location is very challenging task because of following reasons-o PROFIT MARGINS are very less, so PRICE FACTOR is so important

in this project.

• Company has to take into consideration - logistics

- social infrastructure such as proximity of educational institutions for employee’s children.

- skilled labor, proper infrastructure

• 3 Locations which seems to be lucrative were KARNATAKA

WEST BENGAL

UTTRANCHAL

WHY A NEW PLANT??

• Volume Requirement • Strategic decision:

Nearness to raw materials Connectivity Proximity to ancillary units

WHY TATA HAD CHOSEN WEST BENGAL??

Nearness to source of raw material Availability of required Size/Area of land. Government Subsidies Connectivity via Road, Sea Cheap labour

NEARNESS TO SOURCE OF RAW MATERIAL

Singur close to Tata’s traditional base andnursery for newenterprises, the Tata’snetwork of iron andsteel industries in theregion of Jamshedpur, in Jharkhand.

Singur - Jamshedpur 280 Kms. (approx)

AVAILABILITY OF REQUIRED SIZE/AREA OF LAND

997 acres of land assured by West Bengal

Government 645.67 acres of land for mother plantPlans to have ancillary units in the same area Schools, hospitals, training facilities etc

also to be built.Land at very concessional rate payable within next 20

years.

GOVERNMENT SUBSIDIES

100% exemption from Excise Duty for 10 years 100% exemption from Corporate Income Tax for first

5 years and 30% exemption for next 5 years 650 acres of land on lease for 90 years @ Rs.8,000

per year per acre for first 45 years, Rs.16,000 per year per acre thereafter Power Subsidy

CONNECTIVITY

Connected by NH-2 New Delhi Kolkata National Highway

Connected to Gujarat, Maharashtra, Chhattisgarh, Orissa and Jharkhand by NH-6

Haldia Port for overseas exports

CHEAP LABOUR

47.3% Unemployment prevailing in state 17.9% employed work for less than Rs.1000/month Poor working conditions

ROLE OF WEST BENGAL GOVERNMENT IN ACQUIRING LAND

Govt. of west Bengal came forward in acquiring land because LAND WAS FRAGMENTED.

Justifications given by govt in land acquisitions are as follow:- It is for public purposeEmployment Generation Development of SocietyCompensation to farmers which is 150% more than current

market price.

Owners of single crop land in singur got Rs. 8,40,000 per acre

Owners of double-cropping land will get Rs.1.2 billion per acre.

Important factor in convincing 9000 land owners was COMPENSATION PACKAGE by West Bengal government.

JUSTIFICATIONS GIVEN BY COMPANY TO FARMERS IN ACQUIRING LAND

cited eg. of Uttaranchal where company set up a plant and the farmers of Uttaranchal have gained profit.

Approached NGO’s and Panchayats to provide trainings to locals.

Promised to give technical training in areas such as carpentary ,plumbing,electrician , simple fitting.

• Proposed weekly forum meeting.• Special training programmes for women• Plan to introduce technical subjects in local secondary

schools

WHY ACQUISITION OF LAND IN SINGUR WAS FAILURE

• ACC. to govt acquisition process was completed and land is handed over to WBIDC , but still 3000 farmers yet to receive payment.

• Another allegation was acquisition of land is for private purpose.

• Acc to opposition, aqcuisition has not followed well estblished procedure of company making advance payments

• Land is being given to company at very concessional rate.• Other allegation is that Tata has acquired land far in

excess of what it actually requires to set up factory of that capacity.

• Major allegation on Tata is that they had forcibly acquired FERTILE LAND.

• Acc to Mamta Bennerge ,Out of 1000 acres,450 acres were FARMING LAND,and should be given back to farmers.

• Now  Mamta  Benerjee  was troubling and disturbing their work schedule and their supporters is trying to every possible activity for exit their plant from singur.

• As a result , Tata's move out from singur.

Why do you think Tata’s had gone for Singur instead of Sanand? Did they made a right decision in doing so?

Justify your answer.

• Sanand was never an option by the TATAS. Sanand was offered by Gujarat CM Narendra Singh Modi after seeing the opportunity in the ongoing fight related to Singur in West Bengal.

Benefits of TATA in moving Gujarat

PROXIMITY TO AHMEDABAD(30

KM)

Tata Nano project location in Sanand

boasts of close connectivity to

National Highway-8 connecting Rajkot and

Ahmedabad.The Nano site is also close to the proposed

Dholera port. This could mean that if the Tatas need to export

the Nano, they wouldn’t  have to go

far.

The Sanand plant will also have the convenience of

being close to Rajkot where a slew of Nano components would be made at different

ancillary units

The benefits offered by the Gujarat government to Tata Motors are slightly better that what the West Bengal government offered to Tata Motors, he added.

• NO,TATA didn’t make right decision ….Because of the following reasons-lack of political wiliness- Agricultural land

Why did Tatas prefer to locate their ‘dream car’ plant at Singur, West Bengal at first place despite other equally good option such as Dharwad and

Uttaranchal?

VendorsTransportation costTerrainSize of parent plant

THANK YOU