Sunday, March 23, 2008
Tata chief says his ultracheap car will be least polluting
MUMBAI: Tata Motors' ultracheap car will be the least polluting vehicle on Indian roads, the company's chairman said, refuting criticism that the 100,000-rupee ($2,500) car would add to traffic chaos and carbon emission.
Ratan Tata said late Monday his company will bring what is being billed as ''the people's car'' to market next year and its price would be on target, despite a sharp rise in prices of steel and other inputs since the project was announced three years ago.
Auto makers from around the world are keenly watching progress in the Tata project, which analysts say could set new price benchmarks and force other manufacturers to follow suit.
But Tata has been criticized by environment groups who say the attractive price tag would bring the car within the reach of millions of ordinary Indians, triggering more pollution and burdening the country's crumbling infrastructure.
However, Tata said his car will adhere to strict quality norms like any automobile in the developed world.
''We will have less pollution per vehicle than any other vehicle in the country today,'' Tata said.
The pollution levels will be close to that of two-wheelers, he said.
He acknowledged there would be more congestion, but said the answer lay in building more infrastructure rather than ask auto makers to roll back production.
David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, said a small car with a small engine is likely to pollute less than those with larger engines.
But a clean car in India likely would not meet U.S. Environmental Protection Agency pollution limits, he said.
''Most of the developing countries, their emissions standards are just sort of getting cranked up now. The baseline is not very difficult to surpass,'' he said.
Tata said he was curious why his low-cost car that caters to the aspirations of average Indians was being singled out for criticism.
Earlier, there was skepticism that the company could stick to the price target and now it is facing ''flak for a different set of reasons,'' he said. ''Damned if you do, damned if you don't.''
Initially, the company plans to make between 250,000 to 500,000 units a year, Tata said. While the base model will cost 100,000 rupees, the company will offer two more variants at a higher price with added features, he said.
Keeping fuel usage flexible, including the use of ethanol, was also being considered, he said.
The project has spurred other global automakers to explore similar ventures.
Already, French auto maker Renault SA and its Japanese partner, Nissan Motor Co., are trying to determine if they can sell a compact car for less than $3,000.
Japan's Toyota Motor Corp., South Korea's Hyundai Motor Co. and Chinese auto maker Chery could also be looking to make ultra-cheap cars in India, analysts say.
According to German auto consulting firm CSM Worldwide, the new car could help Tata Motors emerge as the country's largest manufacturer of cars and light trucks by 2013.
Although a giant in truck and bus manufacturing for a long time, Tata has only about one decade of experience selling cars, which are limited to a handful of models. In India, it trails South Korea's Hyundai Motor Co. and market leader Maruti Suzuki Ltd., which is controlled by Japan's Suzuki Motor Corp.
Besides the ultracheap car, Tata said the company will introduce several new models next year, most of them in partnership with Italian auto maker Fiat.
India is among the world's fastest growing automobile markets, thanks to a booming economy that has boosted middle class incomes and demand for cars.
Buy the Nano Online?
There is a very interesting thread in the forums section of this site which talks about online booking and purchase of the Tata Nano. Thanks to our user Mathew Vattolil for sparking off such an interesting discussion.
(Visit http://tatanano.inservices.tatamotors.com/tatamotors
/index.php?option=com_fireboard&Itemid=95&func=view
&id=327&catid=11&limit=6&limitstart=0 to participate in the discussion)
Selling cars on the net. How real is this option for a manufacturer? Does the web really stand in competition to a conventional dealer?
Conventional automobile wisdom says that if a car dealer is any way required to complete the transaction, a web based option is a mere information window. It can never really be an alternative to a 'brick-and-mortar' dealer.
But in this age of e-commerce where you can even buy a house online selling a car online cannot be ruled out. In the Indian context, where a car purchase is maybe the second most important purchase for most consumers, why would a consumer prefer to buy a car online rather than going to the dealer nearby. Is convenience of making the purchase at home enough to make an Indian consumer buy online? Or is an online discount the incentive?
The option of online car sales is certainly worth exploring and your comments will help us design the right service.
The views expressed are personal and not necessarily of Tata Motors.
Why India Must Think Small To Stay Big
As the coffee comes in, Tata sends word to remind his driver to have his meal as he is going to be late. The first thing that strikes me about this man is his humility and disarming attitude. Remember, he is India's most powerful corporate chieftain who is equally well known across the world.
The topic now shifts to the all important Rs 1 lakh car and the rationale of moving down the value chain. Is this the best route and does it make sense to ignore the more profitable premium category?
If you look at India, you have about one billion people growing at about 17-18 million a year. You have a middle class or a consuming class of about 250 million, which is increasing from the bottom up each year. And you have a higher percentage at the top of the pyramid, which has been the buying public hitherto for most Indian products.
There is also a segment of the market that is brand conscious, prestige-conscious and would often even prefer to buy foreign brands to Indian brands. They know what is happening elsewhere in the world and would prefer to put their money on a foreign brand rather than an Indian brand, he explains.
In the automobile sector, other than Tata Motors and Mahindra & Mahindra, the industry here largely comprises of foreign companies. As Tata says, while it is an issue of great satisfaction that these two Indian companies have been able to get meaningful market shares. in this arena, only the top part of the pyramid is being addressed.
Hence, the million-plus cars being sold are going mainly to that segment and somewhat to the top end of this large consuming area. I had projected that we would be a million cars in 2000 but that did not happen because we were in an economic downturn.
So we can say that in 2007, our market would be 1.7 million or two million units. But is that really the market potential of the country? After all, it is one where the people buy six million two and three wheelers, which is six times the passenger car market, he says.
As everyone is aware, this is obviously because of the price disparity. The point therefore, he adds, is to be able to address the lower market somehow with a reasonable acceptable product. India, in any case is a country where people have a tremendous urge to own but often it is beyond their reach.
Why do you see such a great sale of clothing on a foot path? Why is Fashion Street in Mumbai so popular? The guy in the factory wears clothes that at least look like what the higher end wear. The fact that they come from Tibet or Nepal is not an issue.
Why is it that the same footpath sources are able to sell tennis or running shoes even if they are fraudulently branded Nike or Reebok? The person is aware of those brands, wants them but cannot afford to pay for them. So, he settles for these, remarks Tata.
What is clear is that if branded product manufacturers can address that market, it is a huge opportunity. The bigger question is the ability to address it and this where Tata believes it is possible.
If we are looking at a small car, we should not do this at the same proportion as cars of today are being looked at. We should be bold and take some risks so that we can have a much larger scale of consumption of that product in India or elsewhere. We need to take a gamble on that and that is my take on addressing that wider market, he says.
Tata believes that this is something that needs to be done because otherwise the Chinese will address that market in India with a suitable product. All that they will do is to squeeze the Indian manufacturers into a position at the higher end of the market, denying him access to the larger market.
We can certainly increase numbers by addressing the lower end on lesser margins but still be profitable. The Ace has been an example at the commercial vehicle end. It is the same thing where you are getting much more for that vehicle.
You must not be overpricing the value for what you are providing. If you can answer that, then it makes sense. Then if you take it further and put power steering, provide air conditioning and so on, it becomes an attractive product that others cannot compete with, he says.
According to Tata, the Rs 1-lakh car would probably be out towards the end of 2007-08. The way it is being planned now, it is going to be a rear engined car, essentially steel, with some plastic parts. It will be a five seater with four doors. No decision has been taken as yet on the engine capacity.
The car will have a continuous variable transmission. At that low cost, it will not have a clutch and will be easier to drive without any gears. It will be a product that will be simpler to deal with, easier for women to drive and something that we hope will add value to the customer, he says.
Tata Motors will produce the bulk of the production in its plant. This is where the entire concept becomes interesting. We What we also wish to do, which is still not fully clear and a concept at this point of time, is to create any opportunity for entrepreneurs, he says.
Low cost units in different parts of the country will assemble the car where Tata Motors will take the responsibility for training on site and other aspects related to quality etc.
We will give young entrepreneurs the opportunity to establish enterprises in distributed areas to produce this for us. We will produce all the high volume parts and send them as kits to these assembly units. This will also enable us to address some international markets in Indonesia, Africa etc on the same kind of basis.
So what we are looking at is designing a product that can be produced in high volumes, which we will do and than can also be viable in small volumes on a batch-basis from kits. With many products, if you conceive them for mass manufacture they cannot be produced in another form. This is what we are trying to do. It is taking more time because we have given ourselves a more complex situation, says Tata.
What he would like to see ideally, in the India of tomorrow, is 10 young graduates getting together out of an IIT and saying, Instead of having to work for somebody, we would become an enterprise of our own.
He adds, Hopefully we would like that enterprise to also sell the vehicle in that area. We would like the service engineer to be trained by us that could perhaps serve the customer. He could use the spare parts of this enterprise to service the customer. Can we change the traditional manner in which the customer is supported on the product?
Eventually, the idea is to not only to give India a low-cost car but create many jobs in different places for young people who otherwise would have to work for someone.
Tata believes that unconventional means would be needed to reach out to the customer.
And in order to do that, one must set his goals high in terms of volumes, as conventional volumes are not going to work.
So you have to be very bold and say that I am going to really change the paradigm of how people are going to travel, how families are going to have transport. I am going to try to get families to stop using tractors to go into town or to sit on a motorscooter in a dangerous manner.
We are trying to address the autorickshaw market in a different way or you will keep doing the same thing. I would really like to be involved in something that is exciting because it is different, he says.
Tata admits that the Rs 1 lakh pricetag has become a challenge and that the company is well on its way to meeting that target. Many people, he adds, still think it cannot be done. But this was the same story with the Indica where the skeptics were convinced that it was impossible to achieve.
It can be done but need not be done in the conventional manner of how the West looks at such products. All I am trying to say is that the way the West perceives something and the way we must look at something is different. The West is not trying to address the low end of the pyramid. He explains.
While this has been a totally indigenous effort, Tata says wherever the company felt that there was an expertise; it did not try to reinvent the wheel. So, even though we have developed our own engine, we are still looking at another engine that we can buy, one that is cheaper than ours and technologically better.
On all these fronts, we are willing to go wherever it makes sense to go. At the present moment, we are certainly keen to also be able to offer diesel as a fuel but this not on the cards at present, he adds.
Think big with the small car: Ratan Tata
The Nano project was delayed because of the political agitation and later other issues. Will Tata Motors be able to wrap things up as per schedule?And will the car itself undergo any more evolution?
There is always last minute engineering that gets done. The main sisue is that we have built the plant. It was flooded earlier last year but thankfully before the machines and equipment were installed. The water receded and construction is now on in full swing both from our side as well as the vendors.
The problem in Singur was not of our making, It was unfortunate. I hope we can improve the quality of life in the Hooghly district as a good corporate citizen should. We have already started to do that and I hope the plant will attract more industries and create more job opportunities for the local populace.
Isn't the Nano very cramped on the inside?
A small car is a SMALL car. If one is looking for a limousine this is not the car to buy. If one is looking for a three-box sedan, this is not the car to buy.
How eco friendly will this vehicle be?
We've not made a claim to be the most eco-friendly in the world. We are in compliance with emission norms in India and this current engine meets BS3 and is capable to being scaled up to Euro 4 as well. There is a cost attached to being a totally green car. At the end of the day, all the things you ask for may not be there in this vehicle because we had a cost target. And that would include some of the green stuff as well.
Will the margins make sense on this car? Will you make money on the Nano?
We are a socially responsible company but we are not a philanthropic trust. We will make profits. As for margins there would be several uptrim versions and we will have our margins spread over those versions.
There has been widespread apprehension that this car would create congestion because of its sheer numbers...
All the question of congestion implies that we will seek the global market with millions of these vehicles. We don't have the resources to do that. But we are country of a billion people. Most Indians are denied connectivity and this is a way.
But India's roads are in terrible shape already. Can they take another 250,000 units of this car? Isn't a more efficient public transport system the answer? It took me one hour to go from south Delhi to Pragati Maidan today and the traffic was a nightmare...
India desperately needs a mass transport system and better infrastructure. But those are issues that we don't deal with. I would be concerned if our vehicle created absolute chaos all over India. If you faced chaos today it did not include these vehicles...so clearly there are other issues involved.
But my point is should the masses be denied their individual transportation rights? This car is not a targeted at a particular segment of consumers. But having said that I hope it will change the manner in which one travels in semi urban and rural India.
Now that your dream project has rolled out, time for you to retire and do the things you have always wanted to do?
Everybody has a desire of stepping aside, of wanting to do what one always wanted to do, to change gears. I have some responsibilities which I have to fulfill before I do that.
Will this car give established players in Europe, Asia and US the heebie jeebies?
I don't think anyone should have sleepless nights. This was achieved by a bunch of young engineers. And if we could do it, it can be done by anyone, probably better. The largest element of cost in a car is material cost. India is not the cheapest on that count due to the tariff structure. But labour is inexpensive and productive. And engineering inputs are very viable.
How can a company that makes the world's cheapest car bid for two of the most expensive and exclusive marques in the business, Jaguar and Land Rover? Where is the fit?
Everybody seems to imply that if you are at the low end of the market, how can you look at high-end cars. But no one asks Unilever for instance how they can make and sell cheap soaps in India or Africa and also expensive cosmetics elsewhere in the developed world.
But the rating agencies have given a thumbs down to the Jaguar-Land Rover deal...
Rating agencies have a clinical, mathematical view of things. That's what they do. So that's alright.
Will the Rs 1 lakh price tag increase? Is this is an introductory price?
No it is not. The price we have announced is the price we are launching the car at.
Does that mean the price will remain constant?
I never said the price will never rise. But I cant say if it did, when. I remember when the Maruti van was first launched I bought one of those for Rs 50,000. I used it for many years. Of course now that product is not available at that price.Our endeavour with the Nano will be to hold our price as much as possible.
How is Tata Motors getting ready to handle the exponential increase in volumes that this car will bring?
The Nano project is not a separate entity. With the Indica it was an issue because we were getting into cars for the first time from being a truck player. Now it's a question of simply expanding that infrastructure.
The car was earlier supposed to come with continuously variable transmission but has now come with a 4-speed manual...
The CVT is not ready for unveiling. But it will be there. We are working on it.
INTERVIEW: Ratan Tata
Tata Motors is a company very much in the automotive industry spotlight. With its Nano small car it has set a new benchmark for producing a low-cost car specifically for emerging markets. It is also about to extend its automotive market presence through the planned acquisition of Jaguar and Land Rover from Ford. Last week, Julian Rendell spoke to the firm's eponymous patriarch, Ratan Tata. | |
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Team that built the nano and how they did it
It's a car that has made history. On January 10, while a select few thousand watched the unveiling of the Nano - the People's Car, a million more around the world saw it on the internet or read about it in newspapers the next day; and it continues to make headlines.
A few weeks after the unveiling, however, its business as usual at the Engineering Research Centre (ERC) at the Tata Motors plant in Pune. Here is where it all began and here is where the Nano team, after the euphoric unveiling, is now quietly gearing up for the next phase: putting the Nano on the road.
"The execution of the project is the real challenge", says the self-effacing Girish Wagh, who heads the 500-strong Nano team. "While we are happy and proud at the reception received by the Nano, we also know that we have a long road ahead." This statement sums up the Nano team philosophy.
It was an incredibly tough journey - filled with challenges, questions, detours and self-doubts. But the Nano team developed and delivered a car that exceeded the world's expectations beyond their dreams.
The team, as one, acknowledges the tremendous support and guidance from Mr Ratan Tata, Mr Ravi Kant, Mr Prakash Telang and the senior management. Mr Tata, they say, not only brought a sense of cohesiveness, but also provided a number of vital inputs - information, guidance, encouragement and the motivation to keep looking at innovation.
As we spoke to some of the members of the Nano team, about their 4-year long journey, we sensed the excitement and the pleasure of a job well done; and the never-say-die spirit of the enthusiastic young team as they gear up to face the challenge of launching the car.
But let's start at the beginning
In 2003, a four-member team from Tata Motors was asked to work on a new project. The brief was very fluid. "It began as an advance engineering project. The idea was to try and create a very low cost transportation with four wheels - it was not even defined as a car," says Nikhil A Jadhav, industrial designer, INCAT, who has been working on the project since inception.
| "What was defined was the cost: Rs1 lakh, about $2500 (at the time the smallest car cost around Rs2.5 lakh), without compromising on aesthetics, value to the customer, or safety and environment requirements, says Jai Bolar, senior manager (development), ERC, and a member of the initial team. The project was a Herculean challenge indeed... |
| The road less travelled The design team first looked at alternative ways of constructing a vehicle. Many concepts were explored and inspiration was sought from existing small cars. The team also debated whether doors were necessary, whether plastics could be used instead of metal, whether interiors could be cut to a minimum, whether a low powered engine would suffice. The focus was always the cost factor and so different technologies were tried. But one question was a consistent driving factor: 'What is the bare minimum a customer will accep'." While it was sure that the design could never go down the auto rickshaw route, the team looked at other concepts: a door-less car with a bar as a safety measure, having soft doors in vinyl with plastic windows, a cloth roof, two big doors (instead of four). But all these kept getting turned down by Mr Tata; he was very clear that it had to be a complete car. "In hindsight, after seeing the kind of joy people got by looking at the Nano, we see how important it was to have a complete car," says Mr Jadhav. |
| Body building Various themes were explored which set the styling direction, with inputs from the Institute of Development in Automotive Engineering, Italy. Differently shaped headlights, larger and more vertical, were designed giving the front of the car the appearance of a little kid, with big eyes in a small face. But Mr Tata asked them to try something different. Horizontal rear lamps were tried out before the vertical lamps (much like the Indica) were finalised. While the constant design changes were frustrating, it also added to the interest factor, feels Mr Jadhav. "If you look at the early renderings of the car, it has metamorphosed into something completely different. But we were always kicked with the fact that in spite of the changes, the car never looked ordinary and boxy. The basic shape and size of the car was always very nice, especially after the lamps changed. In fact that was the point when my interest came back from 70 per cent to 100 per cent." A feature of the new Indica - a spine on the bonnet - was added to the Nano and that changed the front volume and the car started looking more interesting. As the team put it, "It was just a smile in the beginning and the spine accentuated that. That was an important point where the car really started looking nicer; not just a plain car or just another car." The overall shape was developed keeping in mind that this car had to feel large; the wheels at the corner accentuate the car and give an interesting graphic on the road. There was an interesting debate on the bottom end of the glass: there was an inclined wedge till the doors and then a step-up at the quarter window which was tied-in with the bonnet line. But the design team kept debating with Mr Tata where the line should be. They thought that the kickup added a lot of character, but he felt that it reduced the length of the car and asked them to extend it along the lines. This made the car look longer. In the last week of July 2007, just when the team thought it had it all together and could begin work on the virtual phase, there was one more hiccup. Mr Tata felt that the nose of the car looked snub; while the team felt that the nose gave the car a sportier look. But they went back and did some renderings to increase the nose; it actually helped increase the length of the car as well as internal volume. The new design was presented to Mr Tata, at the end of August as a virtual model, and immediately received his sign off. "And that's the car you saw in Delhi," concludes Mr Jadhav with a smile. |
The design work on the interiors of the car was even more interesting with maximum scope for innovation. Here again the focus was on cost reduction, but without compromising on the comfort factor. The directive from Mr Tata was that the customer has to perceive value. So there was a constant tussle in balancing value to customer and cost to company.
The styling was focused on comfort and functionality. "The inside volume was quite large and we were always faced with the challenge that with so much space if we reduce things, it will actually look like there are less things. So we tried to integrate functionality in components. It may cost a little more but you are getting two functionalities at the cost of one," says Siva S Aittili, manager (Industrial Design), ERC.
According to him, the exteriors define the character of the car but the interiors drive the user experience. "It's when a person sits inside the car and experiences the comfort and ambience, that he gets the final overall feeling about the car," he explains. So every detail was benchmarked with a luxury or best-in-segment car and the thinking took a different route to manage within the costing.
Working closely with the sourcing team led to many interesting inputs on what was possible and what was not. The driving instrument cluster is uniquely placed in the centre, giving the car an open look and enabling everyone in the car to look at it. It also makes the dashboard equally amenable to left hand and right hand driving. Initially the cluster was a simple circular shape; then Mr Tata suggested the shape be changed to an ellipse like the Tata logo.
There was a lot of exploration in terms of colours. "We looked at harmony in the colours for the dashboard, the door trims and the seats, to give a good feeling to the customers," says Mr Aittili.
The seating also went through a lot of concept changes with the team and Mr Tata looking at furniture catalogues for inspiration. Frames with tensile fabrics were thought of, but were rejected as too expensive. The final choice was a conventional looking seat with a structure made of metal and the headrest integrated with the seat to save on costs.
The team also wanted the wheels to look different but alloy wheels were too expensive. The final design is called stylein- steel wheels - a concept that looks like alloy but is made of pressed steel; and the cost is almost the same as a normal steel wheel. Other interesting and unique concepts include a central exhaust and the scoop (air way) required to cool the engine, which became part of the design, part of the door feature.
Now that the car has been unveiled, Mr Jadhav and Mr Aittili are fine-tuning the details, listening to feedback and working on it. And after that: "We will begin work on taking this to the world in a whole different way"
Girish Wagh, Head, Small Car Project
"Our biggest challenge was to keep the balance between cost and performance. The brief was that the vehicle should be attractive to customers without any compromises on quality and performance. Mr Tata set the internal benchmarks. The company has done a lot of innovations to bring the cost down.
In such a project there are more failures than successes but never at any point did we think that we will fail. Mr Tata was completely involved with the project as was Mr Ravi Kant who was extremely supportive and participative. They were an integral part of the team along with other senior managers. They created an environment in which people never had a fear of failure; in which they had the chance to use their creativity to a maximum. And the team responded magnificently. They were convinced and passionately involved with the project.
The focus was always on taking the project forward. Our suppliers also put in all efforts and were very involved with the project. The next phase is to have the variants of the Nano; there are lots of exciting possibilities in the development of the car."
The heart of the Nano
The original thought was to have a conventional front engine and a front wheel drive. But then the team started thinking differently. Abhay Deshpande, assistant general manager-Vehicle Integration, ERC explains, "Most highend cars have a front engine to reduce the complexity of the controls; but the engine drives the rear wheels. While driving from the rear is a more efficient way of transferring power; driving from the front is more cost effective as you don't have to take the power to the rear. We thought of taking advantage of both by having a rear engine with front wheel drive. It made the car more low-cost, more efficient and more compact (we could manage with a length of almost 3 metres).
The idea of putting the engine in the rear also turned out to be a major turning point in the design process, a breakthrough of sorts. (The engine was designed to fit in the space behind the rear seat).
The sourcing team went shopping worldwide for a suitable small 35hp engine that could be used in a city car, but could not find anything that fit the budget. In a review meeting, Mr Tata asked whether the engine could be built in-house. And that was a task in itself. A rear engine also meant that all controls had to be changed. "The cables that run in front from the engine to the accelerators etc, now have to travel from the back. This makes them more complex,"says Mr Deshpande.
Fitting the engine, the gearbox and the exhaust system into the space behind the rear seats was yet another challenge. The engine is actually inclined at an angle of 14 degrees to complement the rear seat incline. Starting with a 554cc, the team has managed to increase the engine to 624cc with 27hp.
The engineering team is very proud of the many innovations that have gone into the Nano. The weight in the rear of the car meant that vehicle dynamics were affected; this led to using different tyres for the front and the rear. "The ride and handling is quite optimised for the vehicle. We focused on simple designs and tried to incorporate innovations in that," says Narendra Kumar Jain, Dy GM, engines, ERC. A drum brake system and non-collapsible steering were added to the package, and the car in fact has the smallest turning circle.
Manufacturing planning The interesting challenge here was that aiming for a very low cost car meant the entire organisation had to be leaned down - not just manufacturing, but materials, design, human resources, and so on. "Mr Tata gave us valuable inputs here - he suggested that the team look at benchmarking themselves not just against other automobile companies but also against other consumer product companies. As a result, the team has taken the benefit of best practices from other industries such as cycle manufacturing or PC manufacturing that involve mass manufacture and assembly," says Santosh Bannur, senior manager, planning, Passenger Car Business Unit (PCBU).
"Mr Tata would frequently join us and give inputs on styling, manufacturing processes etc. We also took internal benchmarking inputs from our teams in Jamshedpur and Lucknow," adds Atul Vaidya, assistant general manager , planning, PCBU.
The planning team was joined by members from other processes - the paint shop, weld shop, press shop, assembly shop. "Normally, different departments step in at different stages. But in this project manufacturing, planning, maintenance, etc were all involved from the beginning. The entire vehicle was designed and built in a collaborative manner," says Jaydeep M Desai, assistant general manager, Small Car Manufacturing Planning.
Over the months the 120-member manufacturing team was built through a systematic process, through interviews and evaluations. People were taken from within Tata Motors, as well as from outside, graduate trainee engineers from IIT Kharagpur and Jadavpur University. "There was a mix of experience and youthfulness," says Ajay Tiwari, assistant general manager, HR, Small Car Project. "Though the members were from diverse areas, the team worked well together because the overriding objective was the focus for everyone. There was also a huge amount of transparency as the role of each person was clearly defined."
The diversity of the team helped in generating unique and fresh ideas. Since around 30 per cent of the capital investment in an automotive industry goes into the paint shop, the team looked at alternate options. "But we did not want to compromise on any of the five parameters: safety, quality, delivery, cost and morale. Finally we used the pre-treatment and electro-deposition (PTED) process that is used in conventional cars," says Mr Bannur.
In an effort to reduce capital costs, the Nano team discussed options with top Japanese and German paint shop manufacturers. "We have ensured that this will still be the cheapest car as far as the paint shop is concerned. Working with Krug, Germany, one of the best paint shop manufacturers in the world, we have managed to bring down capital costs and variable costs to a great extent. We have also ensured that we keep to the environmental norms in Maharashtra and West Bengal," says Bannur.
Production concerns
Another cost cutting exercise that was attempted was to reduce the number of tools to make the components while at the same time, increasing the life of the dies used, by three times the norm. "It made the design and manufacture of the dies more complicated. We tried special materials and received a lot of help from the product design team in meeting the target," says another production engineer.
Initially Vivek Suhasrabuddhey, divisional manager, Small Car Project Office, was sceptical about meeting the projected cost because ''the car looked like an Indica, with the same volume but the targeted price was a quarter of the cost of the Indica. But then I realised we could do many things." They started with benchmarking all parts and sub assemblies with vehicles ranging from a two-wheeler to a high-end fancy car. They also did an exercise called design for manufacturing and assembling whereby the design efficiency of each of the assemblies was worked out. ''Basically this means determining how many useful parts there are in the design. We involved the suppliers also in this exercise and they realised that some functions could be integrated in parts. That is how we got some cost benefit," he says.
Because the Nano is a rear-engine car, serviceability and accessibility was a big concern. ''We had to make the car more serviceable and accessible from the customer's point of view. So we did some design modifications to allow this," says Nagabhushan R Gubbi, head of engineering, Passenger Cars. An innovative approach, creating a statistical tolerance sheet for critical failures in product design, gives the team critical control parameters.
The car has undergone all required safety testing. "We have done the full frontal crash testing. The offside frontal is required for Europe and will be required in India too. We have completed all simulations etc and are ready. The car also conforms to all environment norms, including Bharat Stage III," says RG Rajhans, project manager, Body Systems Engineering Automation, INCAT.Ravi Kant, MD, Tata Motors
"It was a huge challenge to make the world-s cheapest car. The Nano is not an urban phenomenon but for semi-urban and rural markets too; after decades of paucity of choice, the common man is finally going to have an option. It has been a great collaborative effort of our partners, suppliers and vendors. Emissions are better than two wheelers and the fuel efficiency is 50 miles per gallon. You consume less fuel, pollute less."
Vendor development
This team had a major contribution to make in lowering the cost of the car because majority of the parts were to be outsourced and had to be procured at low cost. The team evaluated and selected vendors who could deliver quality at the required price and then worked with them to ensure that the parts were made to the right critical parameters on the drawings given by ERC.
"There were two primary challenges for us," says Sachin Singh, assistant general manager, Strategic Sourcing Group." The first was to contain the prices, because every time there was a change in design or specification, the cost changed. The second and unique challenge was to convince the vendors about the volumes." Not surprising since talking volumes of two million over five years was not heard of in the four-wheeler industry.
"A major task was to interact with them, to figure out their processes and optimum capacity to which they could deliver," he adds.
E Balasubramoniam, head - Sourcing, small car project, PCBU says, "A lot of engineering has been contributed by our suppliers. We have about 100 vendors, of which 50 will be co-located at the vendor park at Singur. Of these 15-20 would be integrated facilities."
Some of the vendors are from the Tata Group. The TACO group companies include - TACO IPD, Tata Toyo Radiators, Tata Johnson Controls, Tata Visteon, Tata Yazaki, Tata Ficosa, Tata GS Yuasa Batteries. There-s also Tata Ryerson for the steel service centre and roll form sections, Tata Bearings for bearings and Tata Steel Tubes for the engine cradle.
The big task now is to get the plant operational with the 50 vendors setting up their facilities, clearing all the testing and validation, looking at timelines, the production and ramp rate. "In a normal set up, machines are running and processes are established; here the 4Ms of production - man, machine, material and method, are all new. It is like setting up 50 factories," says Mr Balasubramoniam.
The difficulty also lies in the fact that the product and the location are both new. The team is doing its best not to repeat mistakes from the Indica launch. "We are taking definite measures to minimise problems. We have started the early vendor involvement initiative. It is a unique initiative (3P - production, preparation, process methodology) used by Toyota for their supplier base," he adds.
Ramping up
There are some unique things in this project that have happened for the first time in Tata Motors," says Jaydeep M Desai, assistant general manager, Small Car Manufacturing Planning. Quality systems have been thought about, put in place and well documented so implementation becomes easier. The maintenance practices - failure mode analysis and development - have been completed. "We have ensured all this during the planning phase itself and this will reduce the breakdowns when we start," he avers.
With the car now unveiled and appreciated, the team is looking to provide the finishing touches. The four-year journey has a new beginning.
Nano Fast Facts
Stylish, comfortable
- Designed with a family in mind, the Nano has a roomy passenger compartment with generous leg space and head room.
- Can comfortably seat four persons. Four doors with high seating position make ingress and egress easy.
- With a length of 3.1 metres, width of 1.5 metres and height of 1.6 metres, with adequate ground clearance, it can effortlessly manoeuvre on busy roads in cities as well as in rural areas.
- Its mono-volume design, with wheels at the corners and the powertrain at the rear, enables it to uniquely combine both space and manoeuvrability, which will set a new benchmark among small cars.
Fuel-efficient engine
- The Nano has a rear-wheel drive, all-aluminium, two-cylinder, 623 cc, 33 PS, multi point fuel injection petrol engine. This is the first time that a two-cylinder gasoline engine is being used in a car with single balancer shaft.
- The lean design strategy has helped minimise weight, which helps maximise performance per unit of energy consumed and delivers high fuel efficiency.
- Performance is controlled by a specially designed electronic engine management system.
Meets all safety requirements
- The Nano's safety performance exceeds current regulatory requirements. With an all sheet-metal body, it has a strong passenger compartment, with safety features such as crumple zones, intrusion-resistant doors, seat belts, strong seats and anchorages, and the rear tailgate glass bonded to the body.
- Tubeless tyres further enhance safety.
- The Nano's tailpipe emission performance exceeds regulatory requirements. In terms of overall pollutants, it has a lower pollution level than two-wheelers being manufactured in India today.
- The high fuel efficiency also ensures that the car has low carbon dioxide emissions, thereby providing the twin benefits of an affordable transportation solution with a low carbon footprint.