CASE STUDY-Tata Nano
CASE STUDY-Tata Nano
In 1868, Tata Gamsi founded Tata group. It is the largest conglomerate in India and is owned
by Tata sons. Tata Motors is a leader in manufacturing of commercial, passenger, military and
electric vehicles. It is also the world’s 4th largest truck and 2nd largest bus manufacturer by
volume. In January 2008, Tata Motors introduced Tata Nano, dubbed as the ‘People’s Car’
and also known as the world’s cheapest car. The car was launched in March 2009 which created
a significant impact in the Indian automobile market. Tata Motors Ltd. is one of the few
companies which has its own R&D centres. It has established an engineering research centre at
Pune (with a strength of around 3,500 personnel).
The main target group of customers for Tata Nano are the lower- and middle- income families
in India, many of whom resisted purchasing four-wheelers mainly due to the price
affordability and maintenance cost. Launching of Tata Nano gave an opportunity for these groups
to purchase a car within their means.
During the initial launch, Tata Nano was priced at about rupees one lakh. In December 2008, the
cost of the car increased significantly due to higher raw material costs.
Tata Motors was so confident about Nano that they thought this is going to be a massive
success. But it failed and became one of the most disaster products in the history of
marketing.
QUESTIONS
1. What was the vision of Ratan Tata behind the launch of Nano project? How did he
analyse the environment?
2. In spite of extensive research and development programme, Nano was a huge failure.
Why?