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TATA Nano in Brazil

TATA Nano in Brazil. April 28, 2010. Team Sam Allin, Prakash Hari, Georgina Javor, Federico Ochoa, Gordon Zheng. TATA Motors. India’s largest automobile company World’s 4 th largest truck, 2 nd largest bus manufacturer Cars, light to heavy commercial vehicles & engines Tata Group

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TATA Nano in Brazil

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  1. TATANanoin Brazil April 28, 2010 Team Sam Allin, Prakash Hari, Georgina Javor, Federico Ochoa, Gordon Zheng

  2. TATA Motors • India’s largest automobile company • World’s 4th largest truck, 2nd largest bus manufacturer • Cars, light to heavy commercial vehicles & engines • Tata Group • Interests in steel, autos, IT, communications, power generation • Financials - 2009 • Gross revenues - $6.04 billion - Growth of 46% • Equity - $1 billion • Sales - 30% growth from 2005 to 2009 • Cash flow - $845 million in last 4 years • Global expansion

  3. Brazil • Political • Historically unstable, but stable and thriving economy since 2002 • President Lula da Silva • Economic • GDP - $1.48 trillion ($ 10,514 per capita - PPP adjusted ) • Import Substitution  Export-Oriented Model • Inflation < 4.2% • 1USD = 1.8 Real; 1 Real = 25 Rupee; as of 2010 • Social • Population - 198 million • Uneven wealth distribution - Top 20% has 65% wealth • Regressive tax system • Technological • Major industries : Textiles, chemicals, aircraft & motor vehicles • Investment in bio-fuel technology, consumes 54% ethanol vs 46% petrol

  4. Fiat Millie TATA Nano in Brazil • Tata Nano • Cheapest car in the world - India MSRP is $2,500 USD • Fuel efficiency - 61 mpg / 52 mpg • Variants: Diesel, electric, hybrid • Brazil Car Market • 4th Largest producer and consumer of automobiles in the world • Cheapest new car for the Brazilian market: Fiat Millie USD $11,000 • Export oriented, with 35% import tariff • 1 out of 7 people own a car in Brazil

  5. Investment Strategy • Joint Venture with Fiat • Model on the successful joint venture in India • Tata Motors will own the manufacturing plant • Distribute via Fiat’s existing dealership network • Fiat: 25% market share and strong brand in Brazil • Financial Analysis • Future access to Latin American Markets • Mercosur Trade Agreement - Latin America • Min. 60% indigenous manufacture Traded duty free in the region

  6. Risks and Mitigation

  7. Questions????

  8. Financials

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