GROUP : 6

SHELZA GUPTA SONIA WALIA SURBHI SHARMA SIDDHARTH GUPTA VIKAS HOODA SAMEER NARANG

 Chairman of TATA group- Mr. Ratan Tata.  In 2005-2006,total revenues of companyUS$21.9 billion.  Countrys total GDP in 2005-2006 is $782.14 billion  Companys revenue in 2005-06 2.8% of countrys GDP.(ie. $21.9 billion)  Market Capitalization- US $46.9 billion

 IDEA GENERATION-I saw families riding around on scooters with kids standing up and the mother carrying a baby and sitting pillion and decided to do something about it. It started as a quest for an affordable transportation solution. RATAN TATA source:- Business standard

 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. INDICAS success gave confidence to Ratan Tata to go with his Dream Car.

 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

 Low cost car  Large sales volumes targeted  Large scale production

LOW COST ASSEMBLY OPERATION

NO AIR CONDITIONING ON STANDARD MODEL

WINDOWS WIND DOWN BY HAND

MANUAL STEERING, NO AIR BAG

BODYWORK MADE OF SHEET METAL AND PLASTIC

PLASTICS AND ADHESIVES REPLACES WELDING

 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 Dealers margin

 Search for best Location is very challenging task because of following reasonso 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 employees children. - skilled labor, proper infrastructure

3 Locations which seems to be lucrative were

KARNATAKA WEST BENGAL UTTRANCHAL

 Volume Requirement Strategic decision:

 Nearness to raw materials  Connectivity  Proximity to ancillary units

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

Singur close to Tatas traditional base and nursery for new enterprises, the Tatas network of iron and steel industries in the region of Jamshedpur, in Jharkhand. Singur - Jamshedpur 280 Kms. (approx)

 997 acres of land assured by West Bengal Government  645.67 acres of land for mother plant  Plans 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.

 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

 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

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

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 purpose  Employment Generation  Development of Society  Compensation 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.

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

 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 a ta e erjee was troubli a isturbi t eir wor sc e ule a t eir supporters is tr i to e er possible acti it for e it t eir pla t from si ur. s a result , ata's move out from si ur.

Why do you think Tatas 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

The benefits Tata Nano project offered by the location in Sanand Gujarat government PROXIMITY TO boasts of close to Tata Motors are AHMEDABAD(30 connectivity to slightly better that KM) National Highway-8 what the West connecting Rajkot and Bengal government The Nano site is also Ahmedabad. offered to Tata close to the proposed Motors, he added. Dholera port. This could mean that if the The Sanand plant will also Tatas need to export have the convenience of the Nano, they being close to Rajkot where wouldnt have to go a slew of Nano components far. would be made at different ancillary units

 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?

 Vendors  Transportation cost  Terrain  Size of parent plant