Project Management

The Nano Project:

Making of a Modern Classic

Jaipuria Institute of Management, Lucknow

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Submitted to:

Prof. V. K. Chib

Faculty: Project Management

Jaipuria Institute of Management

Submitted by:

Prateek shrivastav (CFT07-104)

Student (PGDM – 2007-09)

Index

Topics Page No.

The Nano Project 3

The final product 4

Financial Projection 4

Technical Overview 5

Engine 6

Fuel Efficiency 6

Safety And Comfort 6

Vehicle Summary 7

Suppliers of Tata Nano 8

Controversies involved 11

Latest at Singur 12

Bibliography 14

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The Nano project: Making of a modern

classic

Tata Motors is India's largest and leading automobile company, with US $ 7.2 billion

revenues in 2006-2007. With over 4 million Tata vehicles pursuing in India, it is the

premier in commercial vehicles and the second largest in passenger vehicles.

It is also the world's fifth largest medium and heavy truck manufacturer and the second

largest heavy bus manufacturer. Mr. Tata's 'dream project', the Rs one-lakh car has

generated immense interest in the Indian auto market, where Tata's current lowest-priced

car is Indica with a tag of Rs 3.3 lakh. The one lakh rupee car is going to be a real car

with the basic features.

The car is in every way a car, with an engine, a suspension, and a steering system

designed for its size. The most watched car in the Indian car space - the Rs 1-lakh

offering from the Tata Motors stables - is going to be launched in september in 3 variants.

When launched, the car will be available in both standard and deluxe/luxury versions.

Both versions will offer a wide range of body colours, and other accessories so that the

car can be customised to an individual’s preferences. It is aimed to rank between high end

motor cycles and the compact car segment. Instead of researching on low cost

components by themselves, Tata has delegated the task to various vendors.

The fuel-injection system is being developed by MICO while Brakes India and Bosch

Chassis Systems will be supplying low cost braking system. Around 55 prototypes have

been tested on Indian roads under varied conditions. It has been reported that the final

model will make its debut in October 2008. The name 'Nano' was chosen as it denotes

high technology and small size. It was the most eagerly waited car

In the early 2003, five engineers from Tata motors trooped into the main conference

room in the Bombay house, the headquarters of the Tata group. They have been choosen

for the completion of the Nano project which was promised by the company chairman

Ratan N. Tata.

The team of those five engineers along with other member made little progress over the

next year and a half. They tried to source parts from around the world, even toyed with

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the idea of an open car with plastic and canvas sheets for the protection. The problem was

still there i.e. making the motorcyclist safer. Two wheelers continued to overtake the

image of a car in their minds.

The biggest challenge when the project started was there was no brief, no benchmarks,

and it had never been done before. In august 2005, Girish Wagh entered in to the scene.

He was a mechanical engineer; he was responsible for the formation of the first “Mule”

of the car. A mule is a vehicle that comprises the engine and transmission, driving a

mock-up addled with electronic sensors. It moves the vehicle just for the testing purpose.

The first mule of nano had a marine engine that deliver 20 brake horse power (BHP).

The final product:

The Nano is a 33 PS (33 hp/24 kW) car with a 623 cc rear engine and rear wheel drive,

and has a fuel economy of 4.55 L/100 km (21.97 km/L, 51.7 mpg (US), 62 mpg (UK))

under city road conditions, and 3.85 L/100 km on highways (25.97 km/L, 61.1 mpg (US),

73.3 mpg (UK)). It is the first time a two-cylinder non-opposed petrol engine will be used

in a car with a single balancer shaft. Tata Motors has reportedly filed 34 patents related to

the innovations in the design of Nano, with powertrain accounting for over half of them.

The head of Tata Motors' Engineering Research Centre, Girish Wagh has been credited

with being one of the brains behind Nano's design. According to Tata, the Nano complies

with Bharat Stage-III and Euro-IV emission standards.

Financial projection:

Tata initially targeted the vehicle as "the least expensive production car in the world" —

aiming for a starting price of 100,000 rupees or approximately $2300 US despite rapidly

rising material prices.

Tata Motors has been able to cut down the cost of the car by making things smaller and

lighter, doing away with superficial parts and changing material wherever possible.

Tata Motors company had received lakhs of enquiries through the internet for the Nano.

Tata Motors intends to open bookings for the car three months from now.

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Tata Motors plans to produce 2,50,000 Tata Nano Cars in the first phase and add

1,00,000 in the second phase, taking the total production capacity to 3,50,000 cars

probably by the end of the next financial year

As of August, 2008 material costs have risen from 13% to 23% over the car’s

development, and Tata now faces the choice of introducing the car with an artificially

low introductory price, raising the price of the car, or foregoing profit on the car — the

latter an unlikely proposition., while an increased price on the Nano will likely decrease

demand.

Technical overview:

Design

The People’s Car,

designed with a family in

mind, has a roomy

passenger compartment

with generous leg space

and head room. It can

comfortably seat four

persons. Four doors with

high seating position

make ingress and egress

easy.

Yet with a length of 3.1 metres, width of 1.5 metres and height of 1.6 metres, with

adequate ground clearance, it can effortlessly manoeuvre on busy roads in cities as well

as in rural areas. Its mono-volume design, with wheels at the corners and the powertrain

at the rear, enables it to uniquely combine both space and manoeuvrability, which will set

a new benchmark among small cars.

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Engine

Unlike other low cost Indian cars, this one is going to have a variomatic gear system.

Instead of manual gear box in conventional cars it is coming up as gear less or rather with

an automatic gear transmission. This helps to improve the efficiency & mileage by

magnifying the torque output.

As in international markets, the compact car from Tata will have back mounted engine,

pushing the luggage space to the front. Making the engine closer to the fuel tank has

another advantage of increased fuel efficiency.

Rear mounted engine also help in reducing the power loss during transmission. The car

will have front disk and rear drum brakes. The company claims mileage of 22 kmpl in

city and 26 kmpl on highway.

Fuel Efficiency

The People’s Car has a rear-wheel drive, all-aluminium, two-cylinder, 623 cc, 33 PS,

multi point fuel injection petrol engine. This is the first time that a two-cylinder gasoline

engine is being used in a car with single balancer shaft.

The lean design strategy has helped minimise weight, which helps maximise performance

per unit of energy consumed and delivers high fuel efficiency. Performance is controlled

by a specially designed electronic engine management system.

Safety & Comfort

By adhering to the fact that less weight requires less power, the 1 lakh car is made of

light weighing steel. This has made the Tatas come up with a cheap alternative with out

compromising on safety and performance.

The base model will feature glass windows that can be cranked up. The tail lights are

expected to appear like as in Tata Indica. Higher versions will have the comforts of

power steering, power windows, air-conditioning and much more.

With an all sheet-metal body, it has a strong passenger compartment, with safety features

such as crumple zones, intrusion-resistant doors, seat belts, strong seats and anchorages,

and the rear tailgate glass bonded to the body. Tubeless tyres further enhance safety. It

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exceeds current regulatory requirements with a strong passenger compartment, crumple

zones, intrusion resistant doors, seat belts, strong seats and anchorage.

Vehicle summary:

Name Nano

Model Basic

Car Body Type Hatchback

Segment A

SegmentTop Speed 105

Fuel Consumption

Highway26.00

kmpl

Fuel Consumption City22.00 kmpl

Engine specification:

Displacement 624cc

rear engine Engine

Type Petrol

Maximum Power 33bhp@5500rpm

Maximum Torque 48Nm@2500rpm

Dimensions:

Length 3090 mm

Width 1485 mm

Height 1570 mm

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Suppliers to the Tata Nano:

Supplier Product

BoschGasoline injection system (diesel will follow), starter, alternator,

brake system

Caparo Inner structural panels

Continental Gasoline fuel supply system, fuel level sensor

Delphi Instrument cluster

Denso Windshield wiper system (single motor and arm)

FAG Rear-wheel bearing

FicosaRear-view mirrors, interior mirrors, manual and CVT shifters,

washer system

Freudenberg Engine sealing

GKN Driveshafts

INA Shifting elements

ITW Deltar Outside and inside door handles

Johnson Controls Seating

Mahle Camshafts, spin-on oil filters, fuel filters and air cleaners

Saint-Gobain Glazing

TRW Brake system

Ceekay Daikin/Valeo Clutch sets

Vibracoustic Engine mounts

Visteon Air induction system

ZF Friedrichshafen AG Chassis components, including tie rods

Behr HVAC for the luxury version

Market Share of vehicles (domestic):

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Vehicle manufacturing capacity of India:

Installed Capacities in the Indian Automobile Industry 2003-04 2003-2004 2004-2005

Installed Capacity (In Million) Installed Capacity (In Million)

a) Four Wheelers- 1.51

a) Four Wheelers- 1.72

b) Two &Three Wheelers -7.83

b) Two &Three Wheelers- 9.13

c) Engines- 0.18

c) Engines- 0.18

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Controversies Involved

Controversies also arose about Tata's planned manufacturing

unit for the car in Singur, West Bengal, where the state

government of West Bengal has allocated 997 acres (4.03

km²) to Tata Motors. The construction of the car factory on

that tract of land will require fertile agricultural land and the

expropriation and eviction of ca. 15,000 peasants and

agricultural workers.

The affected farmers fear they will receive inadequate or no

compensation and therefore lose their livelihoods. Activists near Kolkata, where Tata's

manufacturing unit is located, started burning the car in effigy. In New Delhi, a group of

six women protested wearing T-shirts bearing slogans that said, "The Rs 1 lakh car has

Singur people's blood on it." The Trinamool Congress alleged that Tata motors usurped

the agrarian land for the construction site and has threatened to stall the manufacture of

the car. The 11 cases were dismissed.

The Nano is alleged to have severely affected the used car market in India, as many

Indians opt to wait for the Nano's release rather than buying used cars, such as the Maruti

800 (a rebadged Suzuki Alto), which is considered as the Nano's nearest competitor.

Sales of new Maruti 800s have dropped by 20%, and used ones by 30% following the

unveiling of the Nano.

It will be a tragedy if such a mega investment and employee generating project by one of

India’s most respected company is lost to West Bengal on account of a failure of

communication among its stakeholders. It’s time that we as a nation begin to think of

such projects as national projects and not become captive to immediate impulses. There

cannot be and must never be any contradiction between industrialisation and welfare of

farmers.

In a democracy, the sensitivity of all stakeholders have to be addressed and in the context

of land acquisition controversies, the new law of land acquisition and rehabilitation,

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proposed by the UPA government, is the way forward. If the Tata withdraws from the

Nano project in West Bengal, investors’ sentiments will be hurt, and the only way for the

company to move forward is for all concerned to ensure a political atmosphere conducive

for investment. The Nano has 34 patents on the car’s design itself, which is a cause for

national celebration as it represents a major technological and manufacturing feat in the

automotive sector. All projects of technological excellence and originality that give India

a special place in innovation and unique competitive advantage, should be treated as

national projects. The state government should ensure the farmers are justly compensated

in terms of price for their land and employee opportunities in the car project through

suitable policy initiative. Democratic government is all about dialogue and moderation,

and we hope that the West Bengal government will initiate purposive dialogue with all

concerned. After all, his unfortunate controversy must be resolved to the satisfaction of

all stakeholders through dialogue alone.

Latest At Singur:

In Tata Motors’ long term interests Singur has become a flash point and a hot bed for

political activity. The average Indian will however be synonymous with Singur as the

chief production facility of the World’s cheapest car. The much talked about 1 lakh

people’s car or the Nano. This statement is the first clear indication by Ratan Tata that he

isn’t interested in dealing with the violent politics of Singur. Ratan Tata is not the type of

man who uses the media to play around which means that today’s statement is a forecast

of what will happen unless things change at ground zero in Singur. For investors and

shareholders of Tata Motors, this is a major development which could go either way for

them and simultaneously their investments. If Tata Motors decide to move out then

almost 2 years worth of work will have to be re-started somewhere else. Despite Tata’s

confidence that they are capable of rolling out the Nano by October, future production

will be hampered if they are forced to shift their project elsewhere. Singur has become a

political issue between the government and the opposition over the government’s

‘capture’ of Farmer agricultural land. While the opposition alleges that some land has

been forcefully acquired, while for some adequate compensation has not been paid; the

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important fact remains that violent methods are being used to deal with the situation.

Farmers protesting the Tata plant have resorted to beating up the staff of the Singur

plant .Serious bodily damage has been inflicted on the staff and family members of Tata

Motors at Singur. This has been the main reason why Tata might very well pull out of

Singur. For the state housing the Nano project, things are serious for West Bengal. The

Nano project at Singur has put in around 1500 crores and will pump in even more once

serious production begins. For a state that is in need of heavy investment, a fiasco like

this will set a dangerous precedent and deter future investments by corporates in India

and the World. Tata Motors if booted out of Singur might make their way to the state of

Uttar Pradesh. Even Uttaranchal and Arunachal Pradesh with their lenient tax structures

could be unlikely gainers. There are also the special economic zones of Gujarat and

Karnataka that hold promise. If Tata decide to move, investors can take heart from the

fact that despite delayed production and eventually sales, the Nano will still find takers.

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Bibliography

"Specifications of Tata's Nano". indiatimes.com (2008-01-10). Retrieved on 2008-01-

10.

"Nano Mania", Autocar India (February 2008). Retrieved on 2008-02-05.

Mohanty, Mrituinjoy (2008-01-10). "Why criticising the 1-Lakh car is wrong", Rediff

News. Retrieved on 2008-01-10.

"Small, It’s The New Big". Newsweek, Keith Naughton, Feb 25, 2008.

"Tata's High-Stakes Bet on Low-Cost Car". The Wall Street Journal, Eric Bellman,

Jan 10, 2008.

Dawn News: The Nano: small is beautiful, by Rahul Singh

"Tata Nano - world's cheapest new car is unveiled in India".

"First Look: Ratan Tata unveils Nano", IBN (2008-01-10)..

"Tata unveils Nano, its $2,500 car". MSN (10 January 2008).

"Materials prices could push up cost of Tata’s Nano". Motor Authority, 7 July 2008.

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