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Transcript of Tata ace
Jegadeesan
Priyatharisini R
Sriram BSK
Uthra G
Vivekh
BIG THINGS COME IN SMALL PACKAGES
Launched in May 2005Inspired from Highly successful Japanese
Minitruck Kei Truck (introduced 1977) and Korean Kia Bonga (1980)
Tata Ace is priced in the range Rs 2.25 lakh for BS II (ex-showroom NCR) Rs 2.35 lakh for BS III (ex-showroom NCR)
Tata Ace is powered by a small and efficient 16bhp 700cc IDI diesel engine
Suitable for both rural and urban useTata Ace sets the trend as the country’s first
high performance, low maintenance safe and reliable mini-truck sporty car-like features to ensure comfort in ride and
handling 04/10/23 2Tata ACE - Team 10-Thiagarajar School of
Management
FY Sales Figures
2005-2006 30,000
2006-2007 70,000
2007-2008 89,000
2008-2009 81,000
2009-2010 110,032 (With Tata Magic 160,000)
2010-Nov’11 160,000 (upto 30-Nov-2010)
Aiming for 250,000 this year04/10/23 3
Tata ACE - Team 10-Thiagarajar School of Management
Ref: http://www.wheelosphere.org/little-elephant-tata-ace-sales-cross-100000-in-fy-2010/
The 3 wheelers had the following issueswore a rustic lookuncomfortable not very safe for carrying load at high speed
Though the price was less, the operating cost was very high
Need for company: blue ocean strategy
04/10/23 4Tata ACE - Team 10-Thiagarajar School of
Management
Quadrilateral project -led to creation of large number of expressways and widened many of the existing highways
A portion of traffic moved from railways to roads and pushed the demand for heavy and light commercial vehicles
Urbanization- cities pushed their geographical boundaries
04/10/23 5Tata ACE - Team 10-Thiagarajar School of
Management
Increasing population and growth in the organized retail sector with the entry of large players
Social status for UsersLast mile distribution vehicleTATA motors identified these macroeconomic
trends Realized that there will be an increased
demand for LCVs in urban areas
04/10/23 6Tata ACE - Team 10-Thiagarajar School of
Management
TATA motors wanted to reduce their dependence on the MCV and HCV segments
They started losing their market share in these segments in the late 90s
TATA motors wanted to diversify The launch of their LCV, TATA ACE helped
in achieving these goalsDuring the financial meltdown (2008-09),
even as the MCV &HCV segments in India shrank by 33% compared to the previous year, Ace in the LCV segment fell by just 12%.
04/10/23 7Tata ACE - Team 10-Thiagarajar School of
Management
04/10/23 8Tata ACE - Team 10-Thiagarajar School of
Management
Subaru Sambar Honda Acty
Mitsubishi Minicab Suzuki Carry
Basic needs of small scale transportersCustomers in rural areas attached
prestige to their transport vehicles SafetyComfort to the driverSpeedAbility to drive in the narrow lanesTight Turning Radius Low operating costs
04/10/23 9Tata ACE - Team 10-Thiagarajar School of
Management
04/10/23Tata ACE - Team 10-Thiagarajar School of
Management 10
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2005 2007 2009
Trend in Market ShareSource: Tata Motors FinancialsReports
-20
0
20
40
60
80
100
120
140
2007 2009 2011Targeted
04/10/23Tata ACE - Team 10-Thiagarajar
School of Management 11
Sales Growth AchievedSource: Tata Motors Financials Reports
Target segment – Individual CustomersTarget customers: who expect a high Return
On Investment (ROI) along with safety, comfort, and status
136,000 Three wheeler SCVs were sold in 2005
With 20% attrition towards ACE and attracting another 25,000 customers, market is very attractive to enter
04/10/23 12Tata ACE - Team 10-Thiagarajar School of
Management
Value propositionHigh Performance with car-like features in
safety, comfort
04/10/23 13Tata ACE - Team 10-Thiagarajar School of
Management
Price was higher as compared to competitors but the company supported it on the basis of the value provided
Initially a discount of 4000 Rs was given80% of the vehicle has been outsourced to
keep costs low without
04/10/23 14Tata ACE - Team 10-Thiagarajar School of
Management
Initial Launch Company launched ACE in the south first through its
Dealers and Dealer BranchesDistribution network: Hub & Spoke model
Existing dealership acted as hubs & set up IS dealerships
Location close to target markets Plant located in Pune at the time of launch Target markets (southern and western regions)
Current Availability 26 Commercial vehicle dealers in Tamilnadu Available in all 28 states 1700 Tata Ace specific dealers all over India
04/10/23 15Tata ACE - Team 10-Thiagarajar School of
Management
Value propositionHigh performance with car like featuresAdvertisement with Tag Line “Kutti Yanai”A symbol powerA symbol of reliability
04/10/23 16Tata ACE - Team 10-Thiagarajar School of
Management
Benefit sought Behavioral SegmentationNeed basedFocus on comfort and safety
Demographic Customer profile SegmentationIndividual Vehicle ownersFleet OwnersInstitutional Customers
04/10/23 17Tata ACE - Team 10-Thiagarajar School of
Management
04/10/23 18Tata ACE - Team 10-Thiagarajar School of Management
Strength1.Strong brand name2.Leverage of First mover advantage3.Good logistic management4.Continuous innovation
Opportunities1.Rural market2.High growth rate of LCV segment
Weakness1.High product cost2.After sales service3.Complaints on gear shifting
Threats1.Increased competition due to new entrants
Piaggio - Ape, QuargoBajaj - Tempo, Max series, RE600Mahindra & Mahindra - MN 25 & MN 31
trucks, MN40, 49 trucks (Navistar Inc USA), Maxximo & GIO
Force motors - Trump Trax, Kargo kingHyundai motor – Porter
04/10/23 19Tata ACE - Team 10-Thiagarajar School of
Management
Model T product development was based on “Traditional Physical Process Sequence”1. Design product, procure and make2. Price, sell, promote, distribute and service
While Tata ACE product development was based on the latest marketing strategy, “Value Creation and Delivery Sequence”1. Customer Segmentation, product focus, value
positioning2. Product development, service development,
pricing, sourcing/making, distribution, servicing
3. Sales force, sales promotion, advertising04/10/23 20
Tata ACE - Team 10-Thiagarajar School of Management
1. Market sensing process Identified the needs of potential customers
like Traders, Truck drivers and Farmers
2. Blue ocean strategy and Rural marketing activities1. Tie-up with Godrej Aadhar and other rural
dealers
04/10/23 21Tata ACE - Team 10-Thiagarajar School of
Management
Functional gratifications1. Speed2. Capacity3. Service points4. Easy navigation in roads5. Low maintenance and operating costs
Sensory gratifications1. Sleek appearance2. Position as “ truck in mini size” 3. Comfort
04/10/23 22Tata ACE - Team 10-Thiagarajar School of
Management
Extended as passenger vehicle as Tata MagicDesigned to larger tyres to acquire greater
speedImproved fuel efficiency by 6-10%Mileage 25kmplSmaller model of Tata Penquin for Rural market
Reference:1. www.tatamotors.com2. www.moneycontrol.com3. www.rediff.com
04/10/23 23Tata ACE - Team 10-Thiagarajar School of
Management
04/10/23 24Tata ACE - Team 10-Thiagarajar School of
Management