Canadian Live-In Caregiver Program

Canadian Live-In Caregiver Program

General Requirements

The live-in caregiver program permits professional caregivers to seek employment in Canada. It also permits these live-in caregivers to seek permanent residence in Canada after working as a live-in caregiver under the program for at least two years.

The term "live-in caregiver" is defined at Section 2 of the Immigration and Refugee Protection Regulations ("IRPR") as "a person who resides in and provides child care, senior home support care or care of the disabled without supervision in the private household in Canada where the person being cared for resides". Based on this definition, such an alien must provide care to children, seniors, or the disabled on a live-in basis.

Seeking a Work Permit Under the Program

According to Section 112 of the IRPR, a work permit will not be issued to a foreign national who seeks to enter Canada as a live-in caregiver unless they:

1. Applied for a work permit as a live-in caregiver before entering Canada;

2. Have successfully completed a course of study that is equivalent to successful completion of a secondary school in Canada;

3. Possess the following training or experience, in a field or occupation related to the employment for which the employment authorization is sought, namely,
   1. Successful completion of six months of full-time training in a classroom setting, as part of the course of study referred to in paragraph (a) or otherwise, or

   2. Completion of one year of full-time paid employment, including at least six months of continuous employment with one employer, in such a field or occupation within the three years immediately prior to the day on which they submit an application for a work permit; and

4. Have the ability to speak, read and understand English or French at a level sufficient to communicate effectively in an unsupervised setting; and

5. Have an employment contract with their future employer.

Work Permit Application Procedure

The employer initiates the procedure by first obtaining a job offer confirmation for the live-in caregiver from Human Resources Skills Development Canada ("HRSDC"). Once the offer of employment has been confirmed by the HRSDC, it will send a confirmation letter to the prospective employer. The letter will instruct the prospective employer to send a copy of the confirmation letter to the applicant.

The prospective employer and the applicant then must submit their live-in caregiver application to the visa office. If the visa office approves the application, the applicant has a medical examination. If the medical results are satisfactory and the applicant is otherwise eligible, a work permit is issued. If required, the applicant must also seek a temporary resident visa at a consulate.

Because of an agreement between the Government of Canada and the Province of Quebec, there are differences in the way the program operates for caregivers who will be working in Quebec. Because the Province of Quebec controls its own immigration, the live-in caregiver program is administered differently in that province. A discussion of Quebec's program is outside the scope of this article. However, additional information concerning the Quebec program appears at the web site of the ministère des Relations avec les citoyens et de l'Immigration (Quebec Immigration).

The Work Permit

The work permit is valid for one year at a time. As the applicant may not apply for permanent residence until two years of cumulative employment (see below), the work permit will have to be renewed at least once. The applicant must renew his or her work permit before it expires.

Permanent Residence for Live-In Caregivers

Certain aliens who have worked in Canada as live-in caregivers may seek permanent residence after certain conditions have been met. According to S. 113 of the IRPR, a foreign national becomes a member of the live-in caregiver class (and is therefore eligible for permanent residence) if:

1. They have submitted an application to remain in Canada as a permanent resident;

2. They are a temporary resident;

3. They hold a work permit as a live-in caregiver;

4. They entered Canada as a live-in caregiver and, for a cumulative period of at least two years within the three years immediately following their entry,
   1. Resided in a private household in Canada, and

   2. Provided child care, senior home support care, or care of a disabled person in that household without supervision;

5. They are not, and none of their family members are, the subject of a removal order or an admissibility hearing under the Immigration and Refugee Protection Act ("IRPA") or an appeal or application for judicial review arising from such a hearing;

6. They did not enter Canada as a live-in caregiver as a result of a misrepresentation concerning their education, training, or experience, and

7. Where they intend to reside in the Province of Quebec, they competent authority of that Province is of the opinion that they meet the selection criteria of the Province.

The cumulative period mentioned above may be in respect of more than one employer or household and need not be without interruption. However, it may not be in respect of more than one employer or household at a time (i.e. concurrent employment).

Permanent Residence Application Procedure

Once the applicant has met the above requirements, he or she may complete an application for permanent resident status. As part of this filing, the applicant must prove that he or she has worked as a full-time live-in caregiver for two years. As proof of employment, a statement of earnings, T4 slips, or other similar documentation should be submitted. If the applicnat has changed jobs since his or her arrival in Canada, records of employment from each of the former employers should also be submitted.

The live-in caregiver application for permanent residence will not be assessed on the basis of the applicant's financial situation, skills upgrading in Canada, volunteer work, marital status or the number of family members in the country of origin. A live-in caregiver can be found ineligible for permanent residence if he or she, his or her spouse or common-law partner, or any of his or her family members have a criminal record or a serious medical problem.

Live-in caregivers working in Quebec will also be assessed by provincial authorities on additional criteria, including their knowledge of French. Additional information relating to Quebec's live-in caregiver program appears at the web site of the ministère des Relations avec les citoyens et de l'Immigration (Quebec Immigration).

Once the applicant has received a favourable assessment on his or her application for permanent resident status as a live-in caregiver, he or she may apply for an open work permit. This allows the applicant to take ANY job while the permanent residence case is pending.

Family Members

A family member of a live-in caregiver may apply to remain in Canada as a permanent residence if the following apply:

1. The family member is a family member of the live-in caregiver, and was included in the live-in caregiver's application to remain in Canada as a permanent resident at the time the application was made; and

2. The family member is not inadmissible.

Family members abroad will be processed for permanent residence at the visa office in their country of residence. They will not be issued immigrant visas until the live-in caregiver has received his or her permanent residence.

The entire family will be required to pass medical and criminal screening in addition to meeting the other requirements. All your family members must pass medical and background checks, whether or not they are accompanying the live-in caregiver. Similarly, the live-in caregiver cannot be granted permanent resident status until all of his or her family members have passed their medical and criminal screening.

Ten Reasons Why Law Firm Marketing Plans Fail

It's almost the end of April and a lot of you who started 2008 out all "gung ho" and ready to change the world marketing wise now realize "lo and behold — NOTHING HAS CHANGED."

Here are ten guaranteed signs that your marketing plan will fail.

1. You talked a good marketing game in January BUT you never made marketing a priority. In other words you wrote up the "big marketing plan" threw it in a drawer and went about business as usual. Marketing is an afterthought as usual–if you don't make marketing a priority and then "live and breath" the concept how do you expect the other team members to get on board and actually execute the big "master plan?"

2. You never prepared detailed cash flow budgets and projections so that you'd have something to measure progress by. REAL businesses run with numbers. Somehow most professionals refuse to accept this.

3. Coincident with number 2…you never developed metrics to measure the success or failure of your plans and activities against projections developed in number 2. Things like response rates, client churn rates, average new billings per clients, client lifetime values…etc. Do you have any written metrics for your firm and do you constantly monitor them?

4. You don't have the right people on board to succeed. As author Jim Collins writes…you need the right people "on the bus and the wrong people" off the bus. If you have a firm full of "grinders" you'll have lousy marketing results. If you look for Rainmakers…guess what; you'll have marketing focus and outstanding marketing results.

5. You haven't set a clear and powerful direction for your entire team. It's much more powerful to have weekly meetings with all your staff and COMMUNICATE that we do "marketing" at this firm and here's what is expected from EVERYONE to achieve those marketing goals.

6. Your firm lacks focus. By focus I don't mean we're say "patent lawyers." By focus I mean laser like obsession with identifying market niches that are lucrative (patent law is not a niche - it's a specialty - BIG difference.) A niche is something like "we're molecular patent lawyers - now who in this country needs molecular patents? Let's go after those prospective clients relentlessly.

7. You provide poor client service. There are certain client "moments" when what you say and do are more critical than others. It's those moments that determine whether or not you'll get client referrals. Are your new client referrals from existing clients growing every quarter or are they declining? If they're dropping off…you've got a client service problem whether you choose to admit it or not.

8. You're spending money on the wrong things. Big fancy offices, expensive cars and country club memberships DON'T bring in new clients. Get rid of all that "stuff" and spend the money on communicating to existing clients and prospective clients how you are IMPROVING the operations of their businesses or personal lives.

9. You can't easily predict future revenues. How much new business will you get from referrals in the next 30 days? How much new business will you get from your web site in the next 30 days. If you're like most lawyers, CPAs or consultants your mouth is hanging open and your mind has gone blank.

Ask any CEO of a Fortune 500 company these questions he or she will respond with EXACT expectations in dollars and percentage terms. All successful businesses strive to create marketing SYSTEMS that generate revenues on a consistent and predictable basis.

Can you speak in such knowledgeable terms about your firm or is all "hit and miss?"

10. You don't look for sources of leverage. Leverage allows you to MULTIPLY all your activities. What's leverage?

Leverage involves things like Joint Ventures with other comparable non-competing firms so that you can access THEIR preexisting client lists and already built up goodwill.

Leverage is designing marketing campaigns and activities that successful connect with "one to many prospects" instead of "one to one." Think breakfast seminars and web casts as good examples here.

 

There you've got ten ideas that will radically improve your marketing results.

Top 10 Expert Witness Cases of 2008

Top 10 Expert Witness Cases of 2008


It is that time of year when pundits, critics and reviewers compile their Top 10 lists of the year's best and worst. This year, we weigh in with our picks of the 10 most important expert witness cases of 2008.

After reading our list, you may not agree with all our choices. Let us know what you think. Share your own top cases and add your comments in our feedback section lower on this page. Now, without further ado, our Top 10.

1. Experts for e-discovery. A ruling on an evidentiary issue may open the floodgates to routinely requiring expert witnesses in e-discovery disputes. It came in the federal prosecution of a former government employee, after the judge ordered the government to conduct a thorough search of electronic files for relevant information.
After the government completed the search, the defendant objected, arguing that the search terms the government used were inadequate to produce the appropriate information.

U.S. Magistrate-Judge John M. Facciola ruled that the issue is "beyond the ken of a layman" and could be resolved only through a Daubert-style evidentiary hearing aided by expert testimony.

"Whether search terms or 'keywords' will yield the information sought is a complicated question involving the interplay, at least, of the sciences of computer technology, statistics and linguistics," he wrote. "Given this complexity, for lawyers and judges to dare opine that a certain search term or terms would be more likely to produce information than the terms that were used is truly to go where angels fear to tread."
The case is U.S. v. O'Keefe, 537 F. Supp. 2d 14, 24 (D.D.C. 2008).

2. DNA expert put to the test. Is it OK for an expert to testify about DNA evidence based on a peer review of the DNA tests, without actually conducting the tests herself? The 8th U.S. Circuit Court of Appeals said yes. Such testimony neither violates the Confrontation Clause nor constitutes hearsay, it ruled.

The decision takes on even greater significance in light of a similar case pending before the Supreme Court. On Nov. 10, 2008, the Supreme Court heard arguments in Melendez-Diaz v. Massachusetts (No. 07-591). The issue there is whether a state forensic analyst's laboratory report prepared for use in a criminal prosecution constitutes "testimonial" evidence under the Confrontation Clause.

The case is United States v. Richardson, 537 F.3d 951 (8th Cir. 2008).

3. An expert's change of mind. Can an expert be sued for changing his mind? That was the question raised by the 10th U.S. Circuit Court of Appeals when it allowed a lawsuit to go forward against a doctor whose change of heart on the eve of trial contributed to dismissal of a medical malpractice claim.

The opinion never decides the question of expert immunity, instead remanding the case to the trial court to consider the issue. But a strong dissent says that sets a dangerous precedent.

"Allowing this claim to march along sends the message to would-be expert witnesses: Be wary – very wary – of changing your mind, even when doing so might be consistent with, or compelled by, the standards of your profession," writes Circuit Judge Neil Gorsuch in disagreeing with his colleagues on the three-judge panel.
The case is Pace v. Swerdlow, 519 F.3d 1067 (10th Cir. March 4, 2008).

4. No Daubert hearing necessary. In a complex antitrust class action, the 6th U.S. Circuit Court of Appeals ruled that the trial court did not abuse its discretion when it allowed an expert to testify without first conducting a Daubert hearing.

The court noted that the trial judge had "spent a substantial amount of time and effort reviewing the parties' voluminous filings relative to the admissibility – or inadmissibility – of [the expert's] testimony pursuant to the applicable standards set forth in Daubert."

A district court is not required to conduct an evidentiary hearing to qualify an expert witness, it said. "The record on the expert testimony was extensive, and the Daubert issue was fully briefed by the parties."
The case is In re Scrap Metal Antitrust Litigation, 527 F.3d 517 (6th Cir. 2008).

5. Software savvy not required. Must an expert who uses software understand how it works? The question arose in a case in which a forensics expert used proprietary software to conduct DNA analysis. He had used the software for years but could not explain its underlying code.

The expert's inability to explain the details of how the software worked, the defendant argued, meant that prosecutors had failed to provide a sufficient foundation for admission of the DNA evidence. The Connecticut Supreme Court disagreed.

It applied a three-part test to find that the software was widely accepted among DNA experts, the expert was well qualified to operate it, and the test results were extensively validated and independently verified.

The case is State v. Foreman, 288 Conn. 684 (Conn. 2008).

6. No scholarly literature. In a criminal case, the defense argued that an FBI agent should not have been allowed to testify about the rifling of gun barrels because there is no scholarly literature on the subject. The 7th U.S. Circuit Court of Appeals ruled that publication is not a prerequisite for expert testimony and that the agent's reliance on the FBI's rifling database was sufficient.

"District judges may admit testimony resting on 'scientific, technical or otherwise specialized knowledge' that will assist the trier of fact. … Testimony based on the FBI’s rifling database may not have been 'scientific', but it was both 'technical' and 'specialized'. Rule 702 does not condition admissibility on the state of the published literature, or a complete and flaw-free set of data."

The case is United States v. Mikos, 539 F.3d 706 (7th Cir. 2008).

7. A Qwest for justice. Exclusion of expert testimony led the 10th U.S. Circuit Court of Appeals to reverse a Denver jury's conviction of former Qwest CEO Joseph Nacchio on 19 counts of insider trading. The three-member appellate panel found that the trial judge had wrongly excluded an expert for failing to disclose the methodology underlying his opinions.

The trial judge may have confused the rules of civil and criminal procedure, the panel suggested. While the former require an expert to prepare and disclose a thorough report, the latter require only a written summary of any testimony and a description of the witness's opinions. The criminal rules do not require extensive discussion of methodology, so the court's exclusion of the expert on that basis was an abuse of discretion that required a new trial.

An en banc panel of the 10th Circuit is currently reviewing the decision. It heard arguments in September but as of this writing has not issued an opinion.

The case is U.S. v. Nacchio, 519 F.3d 1140 (10th Cir. 2008).

8. Capitalizing on complexity. Misuse of expert witnesses in complex patent litigation contributed to a judge's decision to impose more than $10 million in sanctions against Medtronic Sofamor Danek Inc.

U.S. District Senior Judge Edward F. Harrington ordered the sanctions after concluding that Medtronic had improperly resisted the construction of the patent claims mandated by the Federal Circuit Court of Appeals earlier in the case. The company's entire defense, he wrote, was "based on an attempt to obscure, evade, or minimize" the circuit's construction.

Medtronic's strategy was underscored by its reliance on two expert witnesses who each presented testimony contrary to the Federal Circuit's mandate. The defendants "clearly sought to take advantage of the technical and legal complexities inherent in this case," Judge Harrington wrote.

The case is Depuy Spine Inc. v. Medtronic Sofamor Danek Inc., Civil Action No. 01-10165-EFH (D. Mass. Feb. 25, 2008).

9. Business records bite back. Wal-Mart, seeking to block certification of a class action against it for unpaid wages, argued that the plaintiffs' expert's testimony was inadmissible because it was based solely on his review of Wal-Mart's own, unreliable business records. The Massachusetts Supreme Judicial Court disagreed, allowing the class action to go forward on behalf of some 67,000 current and former employees of the retail giant.

"In excluding even the portion of [the expert's] report and testimony that consisted of counting data found in Wal-Mart's own business records, the motion judge acted not on the basis of any challenge to [the expert's] methodology, but essentially on his view that the records themselves were insufficiently reliable," the SJC explained.

"This was error. Business records have a special place in our law of evidence. By statute, business records are admissible even when they would otherwise be inadmissible 'hearsay or self-serving' if 'the entry, writing or record was made in good faith in the regular course of business and before the beginning of the civil or criminal proceeding."

The case is Salvas v. Wal-Mart Stores, 452 Mass. 337 (2008).

10. Statutory limits unconstitutional. What happens when a tort reform statute conflicts with court rules regarding the qualifications of expert witnesses? That was the case in Arizona, when the legislature enacted a statute setting strict requirements on experts in medical malpractice cases.

The Arizona Court of Appeals ruled that the statute violated the constitutional separation of powers. Under the state constitution, the power to set rules governing court procedures belongs to the courts, it said.

"[A] witness qualified under Rule 702 may nevertheless be excluded by the statute's strict practice or teaching requirements," the court said. "The statute is therefore in direct conflict with Rule 702."

The case is Seisinger v. Siebel, 2008 WL 2426811 (Ariz. App. Div. 1 2008).


by Robert Ambrogi - Editor
BullsEye Newsletter: December 2008

Just joke

Two lawyers, Jon and Amanpreet, head out for their usual 9 holes of golf. Jon offers Amanpreet a $50 bet. Amanpreet agrees and they're off. They shoot a great game. After the 8th hole, Amanpreet is ahead by one stroke, but cuts his ball into the rough on the 9th.

''Help me find my ball. Look over there,'' he says to Jon. After a few minutes, neither has any luck. Since a lost ball carries a four point penalty, Amanpreet secretly pulls a ball from his pocket and tosses it to the ground. ''I've found my ball!'' he announces.

''After all of the years we've been partners and playing together," Jon says, "you'd cheat me out of a lousy 50 bucks?''

''What do you mean, cheat? I found my ball sitting right there!''

''And you're a liar, too!'' Jon says. ''I'll have you know I've been STANDING on your ball for the last five minutes!''

Other bank ATM withdrawals free in India

It is not a April fool joke and the date is a strange coincidence. Our financial year starts from April 1 and thus the coincidence. This news is doing the rounds in the Blogosphere for a few days now. We were just waiting for the conventional media to break it so that we can quote it.

ATM withdrawals from other bank branches will be free from Today - APR 1 2009. You can kiss all the priority banking deals a goodbye as free ATM withdrawals is one of the selling points for them. You can also stop searching for your bank ATM and just jump into the nearest ATM for your next withdrawal.

India has 32000+ ATM's.. Much less than what China has. Only recently did we heard about ICIC bank spinning off its ATM services so that it can expand faster. SBI has the maximum number of ATM's in India.

Now, ever since this came up our inquisitive mind kept asking several questions. These might be more questions than answers. we would like your opinion on these.

ATM set-up and expansion as the ICICI has pointed out is not one of the core banking. It is more of an overhead and requires money and other resources. With that background and with this new RBI rule coming into light,

 

How will banks be motivated to expand their ATM's?

Wouldn't every bank offer other banks ATM's to the customers for their lack of penetration?

 

 Would this stagnate the growth of ATM's in India?. At 30000 ATM's for 1.2bn population India really cannot afford that. Would the banks restrict the amount of money one can withdraw for other bank ATM cards?

The transactions will increase for smaller bank ATM's. Would this be an added benefit for them? It is obvious that all bank customers will benefit from this. But what would it mean for the banks?

PS : We wish everybody a happy new financial year.

TCS’s retail revenues grow despite the slowdown. This growth comes from TCS’s BPO offering

TCS in retail: OK for now By DR Alexander Simkin, Ovum March 19, 2009 TCS's retail revenues grow despite the slowdown. This growth comes from TCS's BPO offering and services around analytic solutions

TCS in retail: OK for now

TCS's retail revenues continue to grow despite the slowdown in the global economy in general and the retail industry in particular. The bulk of this near-term growth comes from TCS's BPO offering and services around analytic solutions. ERP adoption is creating BPO opportunities for TCS: The retail BPO market is growing thanks to the selective outsourcing of finance & accounting (F&A) and HR functions. This in turn can be attributed to the implementation by retailers of enterprise resource planning (ERP) solutions. The rise of BPO in retail is linked to the adoption of ERP within the industry. Historically, retailers lacked confidence in BPO vendors, believing that outsourcers couldn't be trusted to run mission-critical processes or to manage data from complex business processes in the timeframes required. But the growing use by retailers of ERP solutions – from suppliers such as SAP and Oracle – is changing that. The use of ERP solutions increases confidence that mission-critical processes are being run as retailers require. ERP solutions also simplify a retailer's complex processes, making it possible for BPO vendors to select suitable processes for outsourcing. Inefficient, labour-intensive and routine F&A and HR functions are now more easily outsourced, and TCS has been among the leaders in jumping into this space. The F&A functions where TCS has seen the greatest opportunities are accounts payables and receivables, ledgers, financial reporting, purchase order payment and invoice matching; and in HR: payroll, policy administration, training and recruitment – functions where TCS has been able to draw on its experience and assets in other verticals. TCS needs to forge a stronger partnership with Oracle: Analytics is the other line where TCS is seeing growth in retail. Analytics for SKU-level data analysis – such as assortment by store and item management in the supply chain – and for consumer-level data – such as buying patterns, loyalty and demographics – offer rapid ROI. So even when IT budgets are feeling the pinch, as they are in the current economic climate, the business case for services around analytics is not a difficult one for CIOs to make. TCS has a partnership with SAS which accounts for much of TCS's retail analytics revenues. But SAS doesn't provide the price optimisation solutions that offer retailers the fastest ROIs. The market leader in price optimisation is Oracle and its ProfitLogic suite. In the current economic situation, with retail margins narrower than they've been in years, getting retail pricing right is crucial. TCS needs to build its services around price optimisation solutions, and therefore with Oracle. Retailers putting other IT projects on the back burner will impact TCS: The global economic slowdown is forcing retailers to delay or cancel IT projects that aren't mission critical, offer tangible cost savings or rapid ROI. These cutbacks are affecting hardware, software and services vendors. For vendors with little exposure to the retail vertical, these cuts don't matter much. But for vendors such as TCS, with significant retail exposure, they do. Approximately 9% of TCS's total revenues are from retail. So the rate of decline of IT spend in the retail industry over the course of the downturn is of concern to TCS. The counter-cyclical opportunities arising from BPO and analytics provide TCS with a safety net in retail, but it will still feel the pinch of dwindling discretionary spend as national economies slide further into recession. Before the credit crunch hit, many retailers were talking about transformational infrastructure projects and 'nice to haves' such as digital signage. Those projects have largely been set aside. Plans to broaden mobile device use on the shop floor to offer mobile POS (point of sale/service) and price checking have also been mothballed, as have in-store merchandise management solutions. The author is senior analyst at advisory and consulting firm Ovum

 

Outsourcing can thrive in recession

Outsourcing can thrive in recession March 27, 2009 Peter Ryan of Datamonitor highlights that many companies are looking to contact center outsourcers as a means of reducing costs through the recession

Outsourcing can thrive in recession

The recent announcement of Teleperformance's purchase of a Dell in-house contact center in Pasay City, the Philippines confirms Datamonitor's view that many firms will look to work with outsourcers in order to manage costs and/or increase customer satisfaction through the recessionary period and beyond, and hints at a number of trends that may emerge within the contact center sector. Firstly, the decision on the part of Dell to sell some of its contact center facilities to Teleperformance could signal the beginning of a trend among in-house contact center operators to eliminate as many fixed costs as possible through the sale of assets to third-party vendors. Such transactions provide the vendor with an immediate influx of revenue, and also result in long-term cost savings in the form of reduced depreciation of facilities, as well as the costs associated with running a contact center (which can vary tremendously, based on maturity of location and seasonality among others). Datamonitor also suggests that this deal may help to reaffirm the importance of offshore delivery. The fact that Dell has chosen to retain delivery from the Philippines for clients in the US, Australia and New Zealand is important for this business model, especially in the current political climate in which offshoring is often portrayed negatively. However, the fact is that offshore contact center delivery has proven to be an effective way for contact center outsourcers to reduce costs, while tapping significant pools of talent. Therefore, Datamonitor maintains that there is excellent scope for offshore delivery from many countries, including the Philippines. Dell's decision to continue delivery from Pasay City through Teleperformance is testament to that fact. Finally, the deal also emphasizes the ongoing role of outsourcing in the technology sector. For many years, contact center outsourcing has proven to be an important facet of managing costs for technology providers, due to the very low margins associated with this vertical market. By providing Teleperformance the opportunity to handle more technical support interactions, Dell is reaffirming that end-users can be serviced to a high standard by a third-party, at a cost effective level. There can be little doubt that many companies running in-house contact centers will look to imitate the Dell/Teleperformance deal. The issue going forward for many contact center outsourcers looking to benefit from such future transactions will be to identify particular vertical sweet-spots that could exist, and capitalize on them with the right cost and quality messages.

 

Evaluating the Tata Nano

Evaluating the Tata Nano

 

The Tata Nano. "The People's Car" is marketed as India's first major mark as the world's leading innovators and a key enabler for job and wealth creation across India. However, many protest, citing environmental concerns, urban congestion and forced displacement. I was recently provided materials from Tata Motors and it inspired the following exploration of the Nano from three business angles: risk/feasibility, market opportunity, and overall global impact.

 

From a feasibility perspective the Nano was quite risky . First, creating the Nano required 34 new patents and creating the lightest modern production car at half the price of the nearest competitor. Second, as with most new vehicles, Tata will take a loss on all vehicles, estimating break-even at six years, at best an early estimate. This huge investment has weakened their financial position. Last Tuesday, S&P lowered Tata's ratings from B+ to BB- and indicated that further downward revisions were in the offing.

This pushes Tata's bond ratings further into junk territory just as it is struggling to refinance $2 Billion of the $3 Billion bridge loan it took to finance the acquisition of Jaguar and Range Rover. Thirdly, it was not ingenuity that created the greatest impact on cost, it was politics. Tata convinced the Indian people to finance this project through manufacturing plant subsidies from particular states. One plant alone is creating 10,000 new jobs, and there are 3-4 plants expected to break new ground. The states were convinced, however farmers and activists staged violent protests at Tata Motor's Singur plant in February, alleging locals were forced off prime farmland to make room for the plant. The government says it has compensated most of the affected farmers; however, many vehemently argue they were forced into giving up their land and primary trade against their will. Tata has since moved the plant location.

The Market
From a market-driven perspective the opportunity is palpable. Small cars are currently in-vogue on the global scale. While India purchased over 7M scooters in 2000 compared to 1M autos the Nano's price enables it to directly compete with scooters. India is about to enter a mode of wealth creation greater than China, as it finally recognizes its population as an advantage, not burden. The largest group of baby-boomers ever are entering the workforce (average and median age is 25 in India, over 40 in China) creating a surge in demand that no economy has ever seen. Currently, there are only 6M car owners in India and 18M have the means to buy one. Amazingly, the Nano's price point increases that pool of potential auto owners by as much as 65 percent, to 30 million just as the target market dramatically increases.