Executive Summary
Tata Motors, the General Electric of India is a conglomerate with a commanding presence in a vast industries across India and globally. In January 2008, Tata introduced to the Indian public it’s ultra cheap car “Nano”. The expected retail price for the Nano was expected to be as little as USD2,500 and would cater for the fast growing middle class segment of the Indian population. Tata Motors was set to change the face of the automobile industry in India. This was however met with some challenges, given the economic environment of India and thereby causing a delay of the launch by six months. The introduction of the “People’s car” created a new category/ trend of ultra cheap cars which then led to other auto makers …show more content…

The crux of the problems lie in the fact that land is one of India's scarcest resources, and its acquisition is key to balancing industrial growth with the needs of rural farmers. Sunita Narain, head of Delhi's Centre for Science and Technology observed that India is seeing local people having a voice in the process and thinks Indian democracy can accommodate it without the violence. In fact some economist says the Indian system will give rise to a "negotiated industrialisation".

Given this scenario, there is a surely a pertinent risk of doing business in India as the government is not able to give a certain degree of assurance that a business will not be met with problems from the people. The fundamental problem that was seen in the Nano case was not the difficulty of obtaining approvals, material etc but the resistance of the people.

Would you agree that introduction of the Nano to the world auto market will be setting a new trend in the auto industry, and possibly reshaping the industry? What did Tata Motors teach other automakers in terms of leadership and innovation?

Upon launch Nano saw a surging demand from first time buyers and motorcyclist in India contrasted with plunging automobile sales in the U.S. and Europe market where the economiy kept