Tata Nano †a Study on Business Challenges in India

TATA NANO – A STUDY ON BUSINESS CHALLENGES IN  INDIA Introduction Tata Nano, pet project of the chairman of the Tata Group Mr. Ratan Tata was a car which was expected to change the face of automobile sector in India. In the highly competitive small-car market of India, Tata Nano promised to set the bar so high that it would become extremely difficult for the competitors to match. The dream of owning a car for as little as Rupees 1 lakh (Rs. 100,000 – roughly USD2500) was too tempting for millions of Indians who cannot afford even a small car.The kind of extensive media coverage Tata Nano received right from the day it was announced through the entire period until the first units were handed over to the owners was something that its competitors dreamed of. However, after two years of launch, the Tata Nano manufacturing plant at Sanand in Gujrat, India is running at around 20% utilization. People’s Car- It is a common sight in india to see an entire family of fou r travelling on a two-wheeler in heavy traffic and bad road conditions all through the year. Car Ownership across countries – Present and FutureAs can be seen from the IMF report above, car ownership in India is expected to grow exponentially in the coming decades. India’s Growth in GDP Per Capita Combining the predictions about car ownership in India with the growth in GDP per Capita in India, we can clearly see why the automobile sector, especially the small car market is one of the most competitive sectors in India at present. In a market like this, a car like Tata Nano had the potential to sell like hot cakes. But it didn’t. Let us now try and understand why Tata Nano was not able to meet industry expectations. Reasons for SetbacksTata Nano (Photo credit: Wikipedia) Too Many Crises – Since its launch with great fanfare in 2009, the Nano has survived from one crisis to another. There was opposition to Tata’s original plans to site the factory in West Bengal, as discussed later, forcing a last-minute scramble to switch the site to Sanand. It opened last summer, but not enough cars came off the production line to fulfill the early orders. To make matter worse, a few cars catching fire on road, raising fears about the Nano’s safety. Price –Nano’s price, which was supposed to be its USP, is apparently one of the major reasons behind its low sales.For majority of Indians, owning a car is not about utility or mobility; it is a dream, ambition and status symbol; just like a house. So, the low price of Nano does not turn it into an asset. It becomes more like a commodity. Also, the initial marketing and promotion of Nano gave the average consumer the idea that owning a Nano would somehow be a confirmation of their poverty, and not a way to get out of it. Ironically, a big number of Nano’s buyers buy Nano as their second or third car after already owning another car. This segment is not the segment initi ally targeted by Tata.Resale-The re-sale car market gives stiff competition to the Nano. A 3-4 year old used car originally costing 3-4 lakh in on-road price (like Chevrolet Spark and Maruti Alto) can pose a stiff challenge to Nano given the relative price-parity that emerges when it comes to re-sale. For instance, Nano’s Mumbai on-road price for Std BSIII model pegged at 1. 51 lakhs is a few walks away from the Rs. 2 lakh plus used-car-version ‘Spark’. People, who may go for the advanced model Nano Cx BSIII, may consider opting for ‘Spark’ or ‘Alto’ given that the said Nano model costs around 1. 2 lakh rupees. In fact, Nano seems to have failed to pose a challenge to the market players in this re-sale car niche segment. Needless to say, there is not much value extracted from a Nano upon resale either. Rescuing Nano – To improve Nano’s market performance, Tata motors is trying to expand to other regions searching new market s for Nano. Given its modular design, Nano can be assembled and manufactured in practically everywhere on the planet. Hence, Tata is looking at SAARC nations, Latin America and other regions, where the economic conditions are similar to India.Also, Tata is contemplating coming up with Nano electric models and even a Nano diesel version After suffering setbacks with the initial market response, Tata Motors hired Carl-Peter Forster, a former boss of General Motors Europe as head of Tata Motors in February 2010. After taking charge, Forster realized that he will have to reinvent the Nano business model. There was no real national distribution scheme, very little marketing and advertising, and no effective system of consumer finance. The irony was that many rural Indians never got to hear bout or have the opportunity to see the car that was supposed to help transform their lives. Issues with Nano The Nano’s marketing problems began with its product positioning. The price crept up by around 15%, putting it out of the reach of first-time buyers with no regular employment or payslips to back an application for credit. And by emphasising its cheapness rather than its basic but appealing qualities, it deterred slightly better-off consumers who could afford one but aspired to more sophisticated vehicles, such as those from Tata’s biggest rival, Maruti, the leader in India’s small-car market.Political Controversies – Nine months after the Tata Nano was unveiled to much fanfare, and with only weeks before the first car was scheduled to roll off the assembly line, Tata announced it was pulling out of West Bengal where work was near complete on the assembly plant. Company Chairman Ratan Tata noted that Tata Motors had already invested 15b rupees (US$343m) in the small car project. But they had forgotten a vital detail which is a must for big investors looking to start big-idea investments on land owned by poor, mostly illiterate peasants in devel oping countries.At the bottom of the Singur peasant resistance was the need for a land reform that enables peasants to have real choices on whether to continue farming or do something else. For Tata Nano, the government of West Bengal persuaded more than 10,000 peasants in Singur to accept compensation for 1000 acres of farmland on which the Nano plant would be built. However, almost right from the start, as many as 2000 peasants refused the compensation, and demanded their land back. Farmers complained that the state communist government forcibly took their land to give to Tata.With the help of the opposition parties, peasants opposed to the land acquisition filed petitions in court. In January, a Calcutta High Court threw out all the complaints, ruling that there was â€Å"no violation of the Land Acquisition Act or any other regulation† by the West Bengal government in acquiring the land. But never ever underestimate the tenacity of angry peasants. When legal avenues were shut, Singur peasants took to the streets, organising daily protests and roughing up workers employed of the Nano factory.As the protesters grew more menacing, Ratan Tata was forced to acknowledge the possibility of never seeing a single Nano roll off the plant in Singur. While Tata was contemplating the future of his pet project, ad one of the most audacious projects in the history of Tata Motors, Narendra Modi – the Chief Minister of the Indian state of Gujrat approached him and promised to provide all support needed for Tata to move the plant form Singur to Sanand. Finally, Tata decided to move to Sanand and the first Nano rolled off the assembly lines at Sanand soon after.Yet, even as it managed to relocate and hit the market with slight delay, Tata needs to reflect on what happened in Singur to avoid running into the same problem elsewhere. Part of the problem was lack of clear and transparent negotiation between peasant representatives, Tata and the government of West B engal. Although the West Bengal government gave peasants compensation package that was way above the going rate, the lingering perception among the peasant was that a huge chunk of the money was creamed off by corrupt government officials.To avoid this perception, true or false, Tata should have negotiated directly with peasants, by-passing the West Bengal government. Secondly, even as Tata boasted of an initial start-up of 250,000 Nanos from the Singur plant, providing thousands of jobs to residents, it failed to make Singur residents take ownership of the plant. To the people of Singur, wealthy Tata was coming to grab their land to make billions of dollars for itself. Nano on Fire –  To make matters worse, three Nanos have caught fire because of some reason or the other since its launch raising serious questions about its safety and severely damaging its Brand Equity.Though Tata Motors has not commented on the reasons behind the fires, there has been strong word-of-mouth negative publicity towards the car. Recommendations Tata Nano has been a very interesting case about studying business in India and other emerging markets. It has seen some very interesting highs and lows which are unique to the Indian market. However, following recommendations can be made: 1. Clean up the Brand Image – Nano first of all needs to re-establish itself as a credible brand. This might be the hardest thing to do given the beating the brand image has taken because of the fires.Nano would need to aggressively work on its PR and show how the accidents are not because of flaws in Nano’s design but because of some unfortunate external factors. 2. Define a clear Marketing Strategy – Nano needs to have marketing strategies to target its real consumer segment which is the masses of India and showcase the Nano as an aspirational product for them instead of coming across as an accessory for the rich. 3. Focus on Other Countries – Export Nano to Indonesi a, Eastern Europe and also Brazil as well as Southeast Asia where it can be sold without the bad name it has earned in India. . Use Shareholder base of Tata – Tata Motors have a shareholder base of around 350,000 right now. It could be utilized to boost Nano sales through discounts etc. 5. Rework on Pricing – when Nano started, a major challenge was to prove whether it was possible to manufacture a car which can be sold at the price of Rs. 1 lakh. That point has been proven. The real challenge now is creating profitable car business. If Tata starts pricing its Nano in a range where it is more cost-effective, it would first, reduce the losses Tata incurs per car, as well as give the brand a facelift.

Cabeza de Vaca’s Adventures in the Unknown Interior of America

Cabeza de Vaca's Adventures in the Unknown Interior of America describes the adventures of Cabeza de Vaca, a Spanish soldier who was shipwrecked in the state of Florida in the year 1528. The man traveled with a handful of his companions across the states of Florida, Texas, New Mexico, Arizona, in addition to the north of Mexico for many years following the shipwreck. He was sometimes looked upon as a slave, at other times he became a medicine man for the Native Americans encountered along the way. The book describes Native Americans of the time in great depth. Even the flora and fauna of the time – much of which was unique to Cabeza de Vaca – may be seen through the eyes of the Spanish traveler (Covey, 1983). Indeed, this book is one of its kind not only for those that wish to discover more about the history of America but also ardent readers of accounts of adventures. Cabeza de Vaca’s experiences open up the mind. After all, with all our modern conveniences, including excellent means of transport, the people of our time are not expected to become lost and develop enough courage to find their way out of misadventures as did Cabeza de Vaca. Moreover, entirely unique adventures such as those experienced by the Spanish traveler are not easy to experience nowadays with all sorts of information available to us in books and on the Internet. Perhaps this is the reason why the reader expects more from Cabeza de Vaca's Adventures in the Unknown Interior of America. There are no maps in this book, and the modern-day reader expects illustrations to boot. What is more, Covey’s translated and edited version of Cabeza de Vaca’s adventures is not quite easy to read. As an example, between sentences Covey has added material which may confuse the reader. The book was first published in 1961. Then again, Cabeza de Vaca’s adventures are thrilling enough for the reader to simply ignore the imperfections of this account.

Enterprise’s success Essay

Do you think that Avis/Hertz will be able to replicate Enterprise’s success in the local car rental market? It’s hard to believe that Avis/Hertz would be able to replicate Enterprise’s success (at least in the near term) in the local car rental market. Given their current dominance in the market, relationships with auto shops/dealerships/insurance companies, and reservation system’s direct interface with insurers, Enterprise is the most well positioned car rental company for discretionary and insurance repair/replacement rentals. Dominance – Enterprise initially sacrificed investment in the airport market in order to dominate the local market. With its 6,000 branches, one wonders how Avis/Hertz would begin to match Enterprise’s footprint? I imagine this could only be accomplished via substantial capital investments on the parts of Avis/Hertz coupled with initial price breaks for customers in order to tear business away from Enterprise. This action, however, would eat into the profitability of said market. Additionally, Avis/Hertz would have to compete with the burgeoning car sharing industry. These obstacles appear to be too significant to overcome so late in the game. Relationships – The ties established between Enterprise and the auto shops/dealerships/insurance companies are deeply rooted and well founded. In order to convince these institutions that an Avis/Hertz relationship would also be beneficial (or would be superior to Enterprise’s), a compelling sales pitch would need to be made. What can Avis/Hertz offer these institutions that Enterprise isn’t currently providing? The products/services of all three-car rental agencies appear to be of equal quality (if not a slight edge given to Enterprise), so what is the end benefit of new relationships to auto shop/dealership/insurance company? Interface – The case does not quantify any initial investments made by the insurers to develop the reservation interface, but one must assume the investments were substantial (either measured in capital or time). In order to be profitable/dominant in the local market, Avis/Hertz would either have to abolish these ties, establish new ones (assuming there are untapped institutions), or run their systems in parallel with Enterprise’s. The latter appears to be most likely, and that could result in profit erosion, as Avis/Hertz would likely have to reduce prices in order to gain market share. I question whether an auto shop/dealer/insurer would even want to train employees how to use a competitor’s system, unless there is a  substantial upside in doing so. Side note: My only reservation in giving Enterprise sole competitive advantage in this space is their apparent penchant for risk. By handling all of its own vehicle sales, has Enterprise merely been lucky or are they simply more skilled at the buying/selling of their fleet? Given Enterprise’s long-term success, one must assume the latter†¦

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MANAGING IN A MIXED ECONOMY - Essay Example The LU provides transportation to over a billion individuals annually, a number almost equivalent to that, transported by the National Rail Network (NRN). LU’s land portfolio of more than 4,000 ha, a labour force of more than 19,000 individuals, and its coverage of most parts of London, Essex, Buckinghamshire and Hertfordshire, all serve to show the immense significance of this transport system. The Transport for London (TfL) is a public institution currently tasked with the responsibility of managing LU and other modes of transport throughout London. The principal strategy of the TfL is to ensure excellent performance of London’s transportation network, making it distinctive and more efficient in comparison to other cities around the world, while providing London dwellers with ample access to transportation. The TfL also strives to raise the performance standards of the LU in regard to environmental protection, hence making the system a global leader not only in addres sing the challenges of urban transportation, but also in environment conservation. Significant changes towards the better have already been attained in the mentioned efforts, but there are still prevalent challenges, especially in upgrading the Tube to modern standards. Background Based on historical analysis of the London Underground, major development inhibitors have been present, and particularly under investment. Poor financial backing, prior to alteration of managerial structure, had rendered the LU outdated and unreliable. The principal challenge of the body responsible for managing the LU is, therefore, attempting to continually develop a safe and reliable transport service (Great Britain Parliament House of Commons 2010, p. 42). It is, however, imperative to note that while safety and reliability are crucial attributes of an effective transport service, they should not be the sole focus of management. Other features should be accorded equal attention, and these include, time taken during travelling, as well as, quality of services offered in the course of the journey. This is because; most passengers require a fast mode of transportation, especially in the contemporary economic environment where time is a crucial resource. Quality should not be overlooked, since; if customers are granted comfort and proper service during the travel, there is a high likelihood of using the LU other than alternative means of transport. Quality of transportation and proper care of passengers are, clearly, features that London Underground’s members of staff hold with utmost regard. This is evident from the staff’s ease of accessibility and constant willingness to help passengers whenever need arises. The extensive consideration of quality is also apparent from the installation of high-tech security and information systems, which increase customers’ convenience when using the LU. Additionally, there are numerous and regular investments to increase the T ube’s accessibility for passengers (Dunwoody 2008, p. 102). Nevertheless, the management and effective running of the LU is not devoid of challenges. The primary challenge is to sustain constant transportation of passengers, while still trying to transform the

REDUCING HIV RISK AMONG YOUNG MINORITY WOMEN & A HEALTH CARE TEAM Research Paper

REDUCING HIV RISK AMONG YOUNG MINORITY WOMEN & A HEALTH CARE TEAM HELPS REDUCE HIGH BLOOD PRESSURE AMONG INNER-CITY BLACK MEN - Research Paper Example Dr. Martha developed a program that provided free health facilities to black men diagnosed with High Blood Pressure in the inner-city. In his analysis, a group of 300 black men recruited for the experiment indicated that one out of five had accomplished adequate blood pressure control. Human immune deficiency virus is another deadly disease that can be controlled through a change in attitude. The virus is spread through heterosexual activity. The theory to the control of a spread in the virus is, ‘The key to defeating HIV lies with protection’ (Jemmott 1998). The black youth women are the most targeted group as they are prone to the contraction of HIV activities due to their activities and interaction among each other. Education has been identified as a method to prove this theory. This is because it fosters awareness by implicating the dangers of negligence towards the use of protection as the key to defeating HIV spread and its resultant effects (Kendall 2012). Dr. Loretta Sweet Jemmott has carried out an experiment on the theory by developing an educational intervention that delivers eight modules on safe sex practices and abstinence to inner-city black middle school student (Jemmott 1998). The program was successful as it helped in the reduction o f risky sexual behaviour. As a result sexual education was introduced in the education curriculum of the United States of America as well as internationally. The conceptual basis of the two cases of study is to present the logical argument that prevention is better than cure thus there is need to control the spread and effect of various dangerous diseases in order to enhance health practices and population growth of Africa Americans in the United States. Jemmott L, S. (1998). Journal of the American Media Association: Abstinence and safe sex HIV risk-reduction intervention for African American Adolescents: A random controlled trial. New York. National Institution of Public

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Corporate protection - Essay Example In order to achieve these objectives, the company has made an effort of sending its Chief Financial officer and CEO to the Caucasus region, as a fact-finding mission, as well as deploying an expatriate group of 25 employees for 6 months, in order to familiarize with engineering and drilling techniques required in the region. However, the stated objectives of the company have led to it facing a number of threats which requires it to take action. It is needed to increase the expertise of its Protective Security Managers for better examination and understanding of threats hence planing and implementing effective security strategy (Kit bond corporate protection services n.d.). The purpose of the strategy will be to provide protective security solutions, capable of not only maximizing protection for the employees, but also ensuring their liberty in conducting operations in the region. Textar Oil and Gas Company as a multinational corporate organization in the field of gas and oil global exploitation, is facing a lot of difficulties. It is experiencing a number of threats which are putting its employees, especially those in the caucasus region, into a great danger. The emerging Textar’s competitive companies in the market are responsible of these threats. To provide better solutons for these threats, the Company has proposed a corporate orientated protective security solution, through a strategy that involves two maximum security corporations (Halibozek & Kovacich 2003). These security corparations can work as separate entities but in the case of Textar Company, they have decided to work as one unit inoder to ensure maximum security for the company, as well as its employees especially those working in the caucasus regions which seems to be the most insecure region. The first security corporation is KBCPS. This is an asset protection corporation, developed to offer interventions