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Asked a question 3 years ago

What were the factors of the failure of Tata Nano?

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Puru BhatnagarTop Contributor
Business Analyst, Entrepreneur, Business developer, Marketer

Tata Nano when it first come in market, it got a tagline "The cheapest car". It is considered as everyone car's, which is even true as when we look in the car's market we can see an ideal middle class car price to be around 4-5 lac, but the company launched Tata Nano in around 1-1.5 lac range.

The thing is company has done for good that is the price range which they have decided, with a thought that it will attract a lot of people to it, but the thing gone in the other way which result in the failure of the product.

What according to me is actually in India a car is considered as a sign of completeness and shows that person is earning enough that he or she can be consider to be in rich category, but the company has broken down that status and with this thought people start ignoring the vehicle with a consideration that it is can be bought by anyone.

Some other reasons are as follows:

1). Lack of practicality.

2). Emotionally disconnected advertisement.

3). Poor build quality.

4). Product issue.

5).Poor public relations.


1) Late delivery


Tata Nano was very well positioned in the market. It got a great response of the people on their launch day as, many people tried for the car's pre-order. This leaded to the fact that, this car will be getting a great boom in the market which never happened. After the big bulk pre-order, the Tata group was not able to fulfill the promises they made at their launch time. They were not able deliver their final product on time. They were 20 months late from their delivery time. This delay is due to the land and factory dispute b/w Tata group and Mamta Banerjee. Due to this problem they had to shift their factory to Karnataka.


2) Fake pricing


Tata Nano was pitched at a price of 1 lakh only. This pricing was not believable by the people and other car manufacturing companies. Due to this, many people pre-booked the car. Tata Nano was targeting the lower middle class people. They were able to get their target audience very easily at their launch day. But, on the delivery day, the car was priced at 2.5-3 lakhs, which was same as If other small cars like Alto. This fake pricing lead to the fact that most of the people, now was not interested in the product.


3) Tagline of ' the cheapest car '


In India, car is a symbol of status rather than any vehicle. People get respect from the people, if they have car. Now, the Tata Nano was taged as the cheapest car. This made a bad impression on the buyers as now they were thinking that their relatives would think that they cannot afford a good car, that's why they have bought Tata Nano. This tagline i.e. " THE CHEAPEST CAR '' leaded to a big misconception in the minds of the people.