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Old 5th August 2011, 10:16   #1
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Default Did Tata kill Nano when they announced a "1 Lakh" car?

Thread is not intended at Nano bashing at all. Its a nice product to have come out of an Indian company- and I'm proud of it!

However, i do believe TATA lost the game somewhat in declaring it to the masses as a 1L car- right when the product was in the design stage! A failure in marketing that couldn't be corrected till now? How different it would have been, if it were launched as a competitor to the Alto/ M800- but at much lower prices? A 1 lakh car without the hype and burden of being a 1 lakh car.

This thought came few days back when i was interacting with a few non-enthusiasts.

Somehow they all seem to think its a 1L car that costs almost as much as an Alto for the top version. Most of them seem to think M800/ Alto are from a whole segment above the Nano, while the top end Nano does most things same as a base level Alto. For a car thats the cheapest in the world, they all seem to think its overpriced!

Second- the 1L tag coupled with the rear engine configuration (with the engine and exhuast clearly visible at the rear) has some think its more related to auto-rickshaws than cars! And they are sure they are right because of the 1L tag. (Cheaper than ricks!)

Third- Most magazines and newspapers speculated a diesel car for 1 lakhs, and the final product being just a petrol car didnt help matters either, adding to the 'overpriced 1L car' image.


How it would have been different without the 1L car tag? As a direct competitor to the Alto, but at lower price tags?

1. No cheap car tag. It would have been a 2L car at VFM prices rather than 1L overpriced car.
2. Usual TATA VFM game of offering more car per car, at lower prices than Maruti.
3. Usual TATA USP of offering more interior space than competition. Its more spacious than my old WagonR, IMHO.
4. Like all TATA's, a diesel coming in later would have upped the game even more. TATA is known for their diesel cars, and not for their petrol engines. Now, the diesel model carries a lot of burden on its shoulders, before launch.


No amount of marketing seems to be able to overcome this initial marketing mistake. It generated huge hype for the car. But did it really help TATA?

(In the thread title, KILL- Doesnt mean Nano is dead, but its selling very low compared to its sales targets and what the competition (Alto) is selling per month.)

MODS: Searched, but could not find a similar thread. Please merge if necessary.

Last edited by CrAzY dRiVeR : 5th August 2011 at 10:26.
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Old 5th August 2011, 10:21   #2
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

The whole "1 lakh car" was the intended message, right? - those who are on 2-wheels can think of getting 4.

The way inflation is happening, there is absolutely no way there can be a decent car at 1 lakh. The OTR price is bound to be ~1.5 lakhs.

Problem with the Indian public - they consider the trivial aspects while making conclusions - like how Nano's rear engine sounds. Nobody considers how spacious it is or how easy it is to maneuver, how well built it is etc.

What can get better with Nano is intelligent advertising and marketing - that's the only area where it is lacking.
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Old 5th August 2011, 10:58   #3
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Yes I agree with you.
The 1 lac tag added a cheap tag to it. For us a car is still an image symbol.
Also for a person replacing a two wheeler with nano will find the running costs high.
Moreover M800/Alto has a huge reputation and looks of a proper car ( front engined). The poor ride quality also counts.
I have seen people not even considering nano as first car .The first thing people say is second hand M800 or a new alto by stretching the loan amount.
Also there are many people who still believes that Nano is sold for 1 lac.
Majority of the first time buyers to whom this car is targetted will not buy a car based on test drive. They arrive at conclusions by brand image,popularity and reputation on the car and recommendations from owners.
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Old 5th August 2011, 11:25   #4
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

You hit the bull's eye, CrAzY dRiVeR. Tata was gunning for mass market by the promise of cheapest price alone.

Anyone who knows marketing would agree that it is the worst way to present it, especially for cars, which in India targets the relatively well off half of the population.

Yet, Ratan Tata made his promise and almost met his target, sadly at the expense of a stupendous product sucess.

Whatever points you can think of, common man sees the Alto as much better value.

Last edited by CoolFire : 5th August 2011 at 11:26.
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Old 5th August 2011, 11:25   #5
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Totally agree. They marketed the car initially as a 1-lakh car but even the lowest end is 1.5xL OTR. And if you want a car with power windows & AC, you are seriously going into Alto's territory. With the kind of "unsafe" reputation and auto like sound from it's engine, no wonder its not selling. Infact when looking at a second car for us, when i suggested nano to my wife, her reaction was "Yuck. .. who will drive around in an auto !!"
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Old 5th August 2011, 11:29   #6
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Well, you can probably say that now, in hindsight. But a lot of things become easy in hindsight.

Remember the 1lakh rupee car idea from Mr. Tata is quite old, probably 5 years old. World has moved quite a lot since then.

If Tata had actually succeeded in builiding a car selling at around1 lakh rupees and petrol prices hadnt risen as astronomically as they have, the Nano would have succeded in moving a lot of two wheeler riders on to 4 wheelers. Thus I wouldnt call the announcement a mistake, rather a risk that didnt pay off.

Unfortunately, prices of petrol mean that even 20kmpl is not good enough today from running costs point of view. Thus moving a two wheeler rider getting a comfortable 50kmpl to a Nano is not that easy, especially considering you get a bare bones car at twice the cost of a two wheeler. The rise in steel prices and petrol costs have been the undoing of the Nano.

Unfortunately, the scenario has meant that the strategy hasnt worked too well. The only way to salvage is to have a diesel car giving 30+kmpl, and that too only if the govt decides to continue with the subsidies for diesel for private cars.

The problem with the Nano today is they are still concentrating not on taking some of the Alto customers to the Nano, but on having a class of its own. This despite the fact that the Nano on almost all counts is actually a better car than the Alto is.

I think rather than still banking on moving the guy from the bike to the Nano, they should concentrate their marketing today to the fact that the Nano is actually a good and proper "car" that is a bit cheaper than the rest but equally good.
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Old 5th August 2011, 11:37   #7
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
Originally Posted by julupani View Post
Well, you can probably say that now, in hindsight. But a lot of things become easy in hindsight.

Remember the 1lakh rupee car idea from Mr. Tata is quite old, probably 5 years old. World has moved quite a lot since then.

If Tata had actually succeeded in builiding a car selling at around1 lakh rupees and petrol prices hadnt risen as astronomically as they have, the Nano would have succeded in moving a lot of two wheeler riders on to 4 wheelers. Thus I wouldnt call the announcement a mistake, rather a risk that didnt pay off.

Unfortunately, prices of petrol mean that even 20kmpl is not good enough today from running costs point of view. Thus moving a two wheeler rider getting a comfortable 50kmpl to a Nano is not that easy, especially considering you get a bare bones car at twice the cost of a two wheeler. The rise in steel prices and petrol costs have been the undoing of the Nano.

Unfortunately, the scenario has meant that the strategy hasnt worked too well. The only way to salvage is to have a diesel car giving 30+kmpl, and that too only if the govt decides to continue with the subsidies for diesel for private cars.

The problem with the Nano today is they are still concentrating not on taking some of the Alto customers to the Nano, but on having a class of its own. This despite the fact that the Nano on almost all counts is actually a better car than the Alto is.

I think rather than still banking on moving the guy from the bike to the Nano, they should concentrate their marketing today to the fact that the Nano is actually a good and proper "car" that is a bit cheaper than the rest but equally good.
Agree completely. Instead of creating a new segment, Tata should focus on the diesel, get power steering and openable hatch and price it close to 2.5 lakhs on road. It will fly off the shelves and realise its true potential.
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Old 5th August 2011, 13:24   #8
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
Originally Posted by julupani View Post
The problem with the Nano today is they are still concentrating not on taking some of the Alto customers to the Nano, but on having a class of its own. This despite the fact that the Nano on almost all counts is actually a better car than the Alto is.
Mind explaining how Nano is better than Alto ?
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Old 5th August 2011, 13:27   #9
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
Originally Posted by heman_369 View Post
Instead of creating a new segment, Tata should focus on the diesel, get power steering and openable hatch and price it close to 2.5 lakhs on road. It will fly off the shelves and realise its true potential.
With the recent deabte on raising the diesel prices to auto consumers, it would not fly off as expected!

Cheers!
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Old 5th August 2011, 13:29   #10
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

The other day I test drove the Toyota Etios, the cheapest car Toyota makes. And you know what? The moment I got behind the wheel I knew it is the cheapest car Toyota makes.

There is a certain expectation that a car buyer has. This expectation has gone up. Nano has conclusively shown us that it is not the 'absolute' price of a car that is important. Only when a buyer perceives serious VFM will he go for the car.

I drove MileCruncher's Nano around my apartment once. It is a good car. It definitely is. But do I believe it offers any value for my money? I am not too sure about that. My observations:
  1. The left side ORVM is very important to me. What would it have cost Tata to provide that as an optional extra? At least on the top variant.
  2. There is no glove box. Where are car documents supposed to go? Under the rear seat? Not very convenient, is it? What happens when you get pulled over by the police with passengers on the back seat while it is pouring cats and dogs.
  3. How much has TML saved by making the front wheels smaller than the rear ones? The convenience of having all four wheels the same size is worth much more than a few thousand rupees saved.
Yes, the objective was to make the car at 1 lakh. That said, the price is no more 1 lakh. When I get into a car which is missing a glove box the only impression it leaves behind is that the manufacturer is skimping on little things. It is almost like being asked to pay for the air in your tyres when you drive out of the showroom.

That said, Tata dealerships are not exactly known to be customer friendly. A couple of years ago when I was looking for a car, my first choice was the Linea. The dealer spoke to me like he was doing me a favour. I walked out of the dealership and straight into a Mahindra Dealership. Imagine if they talk to a 8-9 lac customer this way, how they would talk to those on shoestring budgets.

The Nano is a good product. Marketing has been poor, true. But the design team could have put in those basics I wrote above. And the dealerships need to be taught that the customer is the reason behind their existence.

Last edited by lucifer1881 : 5th August 2011 at 13:36.
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Old 5th August 2011, 13:35   #11
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

A nice thread topic.
most new car buyers do not want to be associated with the 1 lakh cheaper option car.
They are buying their very first car and this is a huge status symbol for them.
So many folks are even opting for second hand Santro's etc rather than buying a new Nano.
This was he is not associated with the so called cheapo tag.
Our friendly neighborhood vegetable vendor went in for a santro recently for the same reason.
For other folks who are buying the Nano as a second or third car, the image value or status symbol does not matter much. and hence we do not really look at it from that aspect.
That said.
I think the Nano is a wonderful car and i am proud that it has come out from an Indian Stable.
With the rising costs of steel and other manufacturing components. as well as the setback that Tata had due to the plant issues.
It was no longer possible to achieve the 1 lakh price target.
But Mr. Ratan Tata is a brave man, and a fearless one at that, and he loves to take risks.
This one may not have paid of fully.
But i still tip my hat to Ratan Tata ~ a true Saab indeed.
Thank you for giving us the Nano.
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Old 5th August 2011, 13:53   #12
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
Originally Posted by ethanhunt123 View Post
Mind explaining how Nano is better than Alto ?
Well, its got a good deal more more space, its more efficient in city traffic conditions, its cheaper to buy. I have felt it to be more comfortable. Its cheaper to maintain, even more so now with the extra long warranty.

It has a good deal more kit as standard, with front power windows, AC, fog lamps and central locking as standard on a model which is still about 40k cheaper on the road than the base Alto which has none of those.

It looks way cooler with a much better colours, body coloured bumpers and Tata provides some cool extras starting with alloys, stickering, seat covers to make your Nano look even cooler.

The only real disadvantages the Nano has are the lack of boot space and its not that comfortable on the highway as the Alto. The highway bit is really moot in my view, as almost none of the Alto buyers would be serious about doing a lot of highway duty in their cars.

Quote:
Originally Posted by lucifer1881 View Post
My observations:
  1. The left side ORVM is very important to me. What would it have cost Tata to provide that as an optional extra? At least on the top variant.
  2. There is no glove box. Where are car documents supposed to go? Under the rear seat? Not very convenient, is it? What happens when you get pulled over by the police with passengers on the back seat while it is pouring cats and dogs.
  3. How much has TML saved by making the front wheels smaller than the rear ones? The convenience of having all four wheels the same size is worth much more than a few thousand rupees saved.
Well, unfortunately most drivers on our road rarely use the LRVM. Come to think of it quite a few dont use any RVMs at all. But when you want to really pinch the penny, that is what you do.

Also the wheels are exactly the same, but the tyres are different. 135 section at the front, but 155 section at the rear. This has quite a few technical reasons behind it, like thinner front tyres mean easier to turn. As there isnt much load on the front tyres and it doesnt handle power, there is no point in having the fat tyres. Its the rear tyres which do most of the work, and thus are fatter. Also, they havnt skimped cost by going in for tube tyres, but kept on tubeless ones. Similarly, they have gone in for an all independent suspension setup.

Though yes, storage space is a bit less, but I think its more obvious to a person who drives costlier cars on a regular basis. But as a cheap car, I wouldnt mind carrying the documents on me. After all two wheeler riders dont have much space on their bikes, do they.

Last edited by julupani : 5th August 2011 at 14:07.
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Old 5th August 2011, 13:53   #13
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
How much has TML saved by making the front wheels smaller than the rear ones? The convenience of having all four wheels the same size is worth much more than a few thousand rupees saved
Not just few thousands .The cost of a power steering can be saved.Unsprung weight also.
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Old 5th August 2011, 14:04   #14
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Default Re: Did TATA kill NANO when they announced a "1 LAKH" car?

Quote:
Originally Posted by ethanhunt123 View Post
Mind explaining how Nano is better than Alto ?
Quote:
Originally Posted by julupani View Post
Well, its got a good deal more more space, its more efficient in city traffic conditions, its cheaper to buy. I have felt it to be more comfortable. Its cheaper to maintain, even more so now with the extra long warranty.
to add to the valid points brought up by julupani:
- Better turning radius
- Peppier drive; dont ask me how! It is by far the most fun to drive hatch in town. You can chuck it so easily into spaces that you would be surprised.
- Ease of parking: It fits into a space that no other car can claim to. In terms of pure city driving it has now become by favourite car. And this from a person who refused to even have a second look at it!
- Superb AC: it cools very effectively even at 2nd position

I think it should be looked at as a cost effective version of the Smart car; and one that can seat 4 passengers in ease and comfort (in terms of space!)
IMHO, except for the boot the Nano is streets ahead of the Alto. People only shy away from it due to their perception of lack of/ negative snob value.

Last edited by selfdrive : 5th August 2011 at 14:06.
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Old 5th August 2011, 14:04   #15
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Post Re: Did TATA kill NANO when they announced a "1 LAKH" car?

So far as I am aware, the 1Lac rupee figure was more of a media speculation than Tata's promise. Their only statement was that it was going to be a "common man's car".

It has all the strengths of making a great little car. However they seem to market it, the masses are not able to get over small issues like average NVH and bare basic nature of the Nano. Can't put my finger on it, but I guess it's just the Indian mentality.
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