The Tata Nano

The Tata Nano was unveiled in January 2008. The car was dubbed People's Car and the main target was the Indian people and other developing countries The Tata Nano is manufactured using new technology that emphasizes on efficiency and low costs. The car was launched in India in March 2009 at USD $2500.

Its pricing also makes it the world's cheapest car. As such, the company targets the lower income groups, first time car buyers, as well as motorbike owners. Although the car positions itself as the cheapest car in the world, the company is careful not to compromise on quality, safety, and environment. This positioning benefits from the Tata's rich history in automotive industry dating back to 1945.

Within the small car segment, the bargaining power of customers usually plays an important role. In instances where a buyer is strong, the buyer then determines the price. The customers in European and American markets may demand high quality cars that provides a unique driver experience and retails at a reasonable price. This is because the Tata Company models the Nano model as the most fuel efficient model. However, Tata Nano models have very small engines making them unpopular in European and American markets. Hence, the few buyers in this market are able to dictate the terms by bargaining for lower price.