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    The People's Car: Team - Braz en

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    Rafi Uddin Sharik
    The document discusses pricing strategies for Tata's low-cost car, the Nano. It summarizes how Tata aimed to keep costs low through design choices like using plastics instead of metal. It also discusses Tata's initial goal of pricing the Nano at 1 lakh rupees and strategies like penetration pricing to target a mass market. However, increasing input costs forced Tata to raise prices over time. The document proposes recommendations like government subsidies and partnerships with rural banks to further Tata's objectives of increasing sales and market share for the Nano.

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    The People's Car: Team - Braz en

    Uploaded by

    Rafi Uddin Sharik
    69 views20 pages
    The document discusses pricing strategies for Tata's low-cost car, the Nano. It summarizes how Tata aimed to keep costs low through design choices like using plastics instead of metal. It also discusses Tata's initial goal of pricing the Nano at 1 lakh rupees and strategies like penetration pricing to target a mass market. However, increasing input costs forced Tata to raise prices over time. The document proposes recommendations like government subsidies and partnerships with rural banks to further Tata's objectives of increasing sales and market share for the Nano.

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    Tata Nano

    Original Title

    Tata Nano

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    The document discusses pricing strategies for Tata's low-cost car, the Nano. It summarizes how Tata aimed to keep costs low through design choices like using plastics instead of metal. It also discusses Tata's initial goal of pricing the Nano at 1 lakh rupees and strategies like penetration pricing to target a mass market. However, increasing input costs forced Tata to raise prices over time. The document proposes recommendations like government subsidies and partnerships with rural banks to further Tata's objectives of increasing sales and market share for the Nano.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    69 views20 pages

    The People's Car: Team - Braz en

    Uploaded by

    Rafi Uddin Sharik
    The document discusses pricing strategies for Tata's low-cost car, the Nano. It summarizes how Tata aimed to keep costs low through design choices like using plastics instead of metal. It also discusses Tata's initial goal of pricing the Nano at 1 lakh rupees and strategies like penetration pricing to target a mass market. However, increasing input costs forced Tata to raise prices over time. The document proposes recommendations like government subsidies and partnerships with rural banks to further Tata's objectives of increasing sales and market share for the Nano.

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    PRICING STRATEGIES

    for the peoples car

    m
    a
    e
    T

    Presented by:

    n
    e
    z
    Bra

    Dr. Amrita Singh


    Alok Kumar
    Ajay Singh
    Anushree Pandit
    Gaganbir Kaur
    Jatin Saxena
    Jyoti
    Ishrat Batool

    Development of a One
    lakh Car

    WHAT MAKES IT SO CHEAP!


    The TATA Nano uses plastics and
    adhesives rather than welding.
    Partially using inexpensive polymers
    or biodegradable plastics instead of a
    full metal body.
    It has no AC, no power steering, no
    power windows.

    Target Market

    Why should People Buy


    Nano..
    Low price and covers basic needs of
    a car.
    Its look cute and attractive
    Better facilities for servicing and
    maintenance
    Easy finance

    But was It REALLY a 1 LAKH


    Rupees Car?

    Why the price hike?


    Tata said that
    expensive lending rates,
    higher fuel costs, and inflation
    hit margins during the last
    year is forcing us to pass on
    the costs to its customers.

    Increasing input costs, especially that of steel and other commodities like
    rubber, had put pressure on margins.

    TATA PRICING
    OBJECTIVES

    Survival
    Maximizing market share
    Keeping the price range near 1 lakh
    Discouraging potential competition

    TATAS PRICING STRATEGY


    Though the one lack tag was not fixed by TATA
    group, it was the word of mouth of people which
    fixed the range. This expectation of people
    creates a big challenge for the company. To
    accept this challenge the following strategies are
    followed:
    Increasing market share
    Penetration pricing
    Low pricing policy with minimum profit margin

    PRICE OF VARIOUS CARS

    AVAILABLE FINANCING SCHEMES


    Tata Motors Finance (TMF) will provide finance
    up to 90% for the Nano at easy rates.
    the company has announced a four-year or
    60,000 kilometer manufacturing warranty at
    no extra cost.
    Loan within 48 hours

    comprehensive maintenance contract atRs.99


    per month for all new customers.

    Proposed pricing objectives


    Survival
    New market penetration
    Increase the perceived value of Nano
    Increase market share

    PROPOSED PRICING STRATEGIES


    Penetration pricing
    Target costing
    Low pricing policy with minimum profit margin
    which is only 2%
    Perceived value pricing
    Increased market growth
    Discouraged potential competition

    Selecting the final


    pricing
    Influence of other marketing mix

    Cash discount

    Price List
    ex showroom prices
    Model
    Nano BS IV
    Nano CX BS IV
    Nano LX BS IV

    Price
    Rs 145,000
    Rs 170,078
    Rs 196,956

    Banks

    PROJECTED NEW COST


    %
    allocated
    Manufacturin
    g cost
    place
    promotion
    tax
    misc.
    profit

    sales

    2010

    2011

    145,000

    153,000

    40

    58000

    61200

    20

    29000

    30600

    30

    43500

    45900

    7250

    7650

    4350

    4590

    20

    2900

    3060

    60,000

    69000

    RECOMMENDATIONS

    Through government subsidies and tax


    Collaboration for loans with Gramin
    banks and post offices

    Cost effectiveness Spare parts


    packages
    Nano Special Outlets(NSO) discount
    Decreasing down payment in rural
    areas

    Thank You

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