Introduction to Innovation

Case study : Tata Nano and Toyota

2010/2011

Is Tata Nano a disruptive innovation?

Back in 2007, when Tata Motors announced it “People car”, a brand new innovation called Nano, it has clearly shaken the whole automotive industry. This new car not only represents the achievement of an exciting innovative project, but also a huge opportunity for the firm. Since then, Tata Motors is the main player on the small cars market, but should not remain alone on the stage; indeed, Toyota and GM have announced they would also work on the opportunities of this market. Each company is trying it own way to provide his customers an effective, safe, and innovative small car.

When Toyota begun to launch it products on the market, they started with low price point cars, such as the Tercel and then progressively tried to improve their choices in order to give consumers more choice. But not only, the aim was also to improve by the time their range of products and price point. The company tried to understand better the consumer’s needs and expectations in order to be sure to launch an effective product on the market. Toyota realized that people were willing to review their expectations if it allowed them to save money when buying the car.

For many people in general, buying a car is an expensive purchase, sometimes it turned out to be the savings of a whole life. Consequently they think a lot before doing a purchase that implicates them for a huge part of their lives. Price is not the only requirement when buying a car; one should also think about the expenses that a car involves, such as gas, potential reparations…. That also suggests, again, raising the car’s budget… So the idea would be to have a car that doesn’t need a lot of maintenance nor consumes a lot of fuel…

During a long time, Toyota put the emphasis on the quality of it cars, but recently the company have reviewed it criteria’s and launched it