Global Financial Market
Project Report On ³ TATA Motors´
Submitted To:
Prof. Oberoi
Submitted By: Parin savla 36 01 45
(Prof. Global Financial Market Smit bagadia Richa singh
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Acknowledgement
I would like to express my special thanks of gratitude to my teacher .....as well as our principal who gave me the golden opportunity to do this wonderful project on the topic MNC, TATA MOTORS, which also helped me in doing a lot of Research and I came to know about so many new things I am really thankful to them. Secondly I would also like to thank my parents and friends who helped me a lot in finishing this project within the limited time. I am making this project not only for marks but to also Increase my knowledge
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Table of Contents
What is MNC? Introduction History of Tata Motor Branches Mission & Vision Milestones Achieved Facts & Figure PESTEL Analysis Core Competency SWOT Analysis Future Plans Suggestion And Conclusion References
04 06 07 11 26 27 31 33 37 38 41 42 43
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What are MULTI-NATIONAL COMPANIE¶S (MNC¶S) ? ? MNC¶s are huge industrial organizations which extend their industrial and marketing operations through a network of their branches or their Majority Owned Foreign Affiliates. MNC¶s are also know as Transnational Corporation (TNC¶s).
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Features of MULTI-NATIONAL COMPANIE¶S? ? ? ? ? ? ? ? ? Huge intellectual capital Operates in many countries Large number of customer Large number of competitors Structured way of Big size Structured way of decision making Big size decision making
Advantages of MULTI-NATIONAL COMPANIE¶S. ? ? ? ? ? MNC¶s have become vehicles of technology to the developing countries Greater employment and career opportunities are provided by these MNC¶s. MNC¶s make commendable contribution to inventions and innovations in the host country. Practice of MNC¶s bring to the host country, the latest technique in the field of management. Varity of goods and services produced for local customers.
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Disadvantages of MULTI-NATIONAL COMPANIES. ? ? ? ? MNC¶s create monopolies in the market and eliminate local competitors. MNC¶s may create depletion of resources due to its continues use by these overseas companies. MNC¶s generally carry out their R&D in their home country and supply to the host country. MNC¶s generally import huge raw materials due to its continuous use by these overseas companies.
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Introduction
(NSE: TATAMOTORS, BSE: 500570, NYSE: TTM,NASDAQ: TTM) is a multinational automotive corporation headquartered in Mumbai, India. Part of the Tata Group, it was formerly known as TELCO (TATA Engineering and Locomotive Company). Tata Motors is India¶s largest automobile company, with consolidated revenues of USD 20 billion in 2009-10. It is the leader in commercial vehicles and among the top three in passenger vehicles. Tata Motors has products in the compact, midsize car and utility vehicle segments. The company is the world's fourth largest truck manufacturer, the world's second largest bus manufacturer, and employs 24,000 workers. Since first rolled out in 1954, Tata Motors has produced and sold over 4 million vehicles in India. Established in 1945, when the company began manufacturing locomotives, the company manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969. Tata Motors is a dual-listed company traded on both the Bombay Stock Exchange, as well as on the New York Stock Exchange. Tata Motors in 2005, was ranked among the top 10 corporations in India with an annual revenue exceeding INR 320 billion. In 2010, Tata Motors surpassed Reliance to win the coveted title of 'India's most valuable brand' in an annual survey conducted by Brand Finance and The Economic Times. Tata Motors has auto manufacturing and assembly plants in Jamshedpur, Pantnagar, Lucknow,Ahmedabad, Sanand, Dharwad and Pune in India, as well as in Argentina, South Africa and Thailand.
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History of Tata Motors: The Tata Group was founded in 1868 when India was under British Empire. The group formed their textile business in 1874 and Steel manufacturing in 1907. In 1945, Tata Sons Limited started the automotive business with manufacturing steam locomotive boilers after purchasing the shops of East Indian Railways from Government of India, which was under the British Government in that year.
After purchasing these shops, the Tata sons decided to establish Tata Engineering and Locomotive Company Limited (TELCO Limited) and establish the primary manufacturing facility in Jamshedpur (an industrial city in Eastern India). This company was managed by J.R.D. Tata from 1945 to 1973 and by Sumand Moolgaokar from 1973 to 1988.
Sumand established the second manufacturing facility in Pune India looking into the boom in the auto market. In 1991 Ratan Tata took over the Tata Empire from his uncle and moved the Tata group out of the sectors where they were not very competitive ± like Cement and Textiles. Today, Tata¶s largest manufacturing businesses are Steel and Motors after the consolidation carried out by Ratan Tata. As on end of financial year 2008, the Tata Group has an annual turnover in excess of $30 Billion out of which more than $9 Billion is contributed by Tata Motors.
TELCO Limited is now widely known as Tata Motors that is among the world¶s top five manufacturers of medium and heavy trucks and world¶s second largest manufacturer of medium and heavy busses. Tata possess a strategic engagement with Mercedes Benz for assembling and selling Mercedes Benz commercial vehicles and passenger cars in India.
Another strategic tie up that they possess is with Cummins pertaining to their diesel engines through Tata Holset Limited. In fact, Tata Motors contributed to the Cummins Diesel engines by adding turbo chargers on them vide their joint manufacturing operations with Tata Holset Limited.
The only partnership of Tata that didn¶t go well was with Rover Group of Britain that went bankrupt in year 2005. Tata tried entering the European markets through a model named CityRover that faired poorly due to its negative publicity, higher price and poor quality compared to the competition.Ratan Tata is now 70 years old
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but still presents the image of a dynamic, innovative and revolutionary entrepreneur. He is known for high aggressive moves for the benefits of Tata Motors customers. In 1997, Tata Motors launched its first indigenously developed car named Indica that currently possesses more than 15% of the car market share in India.
The other car models of Tata Motors that are popular in India and some markets of Asia are Tata Indigo, Tata Sierra, Tata Sumo and Tata Safari. In 2008, Tata achieved a global publicity due to two major activities that made headlines worldwide. In the Geneva Motor show they presented their four-seater small car named ³Nano´ priced about $2500 which is expected to be the cheapest car of the world.
In March 2008, Tata Motors acquired the two globally prestigious companies ± Jaguar and Land Rove from Ford Motor Company. It is assessed that Tata Motors did so to achieve a new image of a global automotive company like Ford Motor Company given that their business span has largely remained indigenous within India for a long time.
Mission: a) Passenger Car Business Unit ³ To provide passenger vehicles that offer customers exceptional value, and through this build a company that provides its shareholders with superior returns, and is seen by society & other stakeholders as a valuable contributor to their development´ b) Commercial Car Business Unit Shareholders To consistently create shareholder value by generating returns in excess of Weighted Average Cost of Capital(WACC) during the upturn & atleast equal to weighted average cost of capital(WACC) during the downturn of the business cycle. Customers To strengthen the Tata brand and create lasting relationships with the customers by working closely with business partners to provide superior volue for money over the life cycle.
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Employees To create a seamless organisation that incubates and promotes innovation, excellence and the tata core values. Vendor and channel partners To foster a long-term relationship so as to introduce a broad range of innovative products and services that would benefit our customers and other stake holders. Community To proactively participate in reshaping the country¶s economic growth. To take a holistic approach towards environmental protection.
Vision: a) Passenger Car Business Unit ³To evolve into a World Class Indian Car Brand.´ b) Commercial Vehicle Business Unit ³ To be a world class corporate constantly furthering the interest of all its shareholders.´ Core Values: a) Core Values of Passenger Car Business Unit Our core values are built upon the traditions of the Tata Group with emphasis on 1. Trust: We must have faith of the product that we make & to respect the value of our customer. 2. Integrity: We must conduct our business fairly, with honesty and transparency. Everything we do must stand the test of public scrutiny. 3. Concern for the well-being of both the employees & the society: We must continue to be responsible, sensitive to the countries, communities and environments in which we work, always ensuring that what comes from the people goes back to the people many times over.
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b) Core Values of Commercial Car Business Unit The core value of Commercial Vehicle Business unit are1. Integrity: We must conduct our business fairly, with honesty and transparency. Everything we do must stand the test of public scrutiny. 2. Customer Focus: We must understand the requirement of the customer & to continue to improve the quality of our product. 3. Corporate Citizenship: We must continue to have a global presence in the corporate world for becoming a global company. 4. Passion for Engineering: We must have a passion to innovate constantly in making our product. Sustainability The Tata Group is guided by the Principle of Trusteeship and the conviction that Free Enterprise, in order to thrive, must serve the needs of society. This is the cornerstone of our CS initiatives. Tata Motors is committed, in letter and spirit, to the improvement in the quality of life of people. Need for Proactive Stance Equally, Tata Motors believes in being proactive in achieving a balance between business growth and social and environment related needs. Hence, the company¶s business focus is both on personal and public transportation. Hence the company is itself working on or supporting development of alternate fuels, electric and hybrid vehicles, both for personal and public transportation. Need to go beyond Compliance Whether in pursuing its business growth or meeting its responsibilities, Tata Motors intent is to contribute by ³doing the right thing´ as against merely being compliant by ³not doing the wrong things´. Boost to Brand Image In a global syndicated study conducted by TNS across 18 major automotive markets, it was evident that general public¶s perception of a company¶s conduct is a strong reflection of the overall market sentiment towards that company. 94% of the Indian respondents and 89% of the respondents across the globe maintained that they were more likely to purchase a product or a service from a company that they believe follows responsible and ethical business practices. Tata Motors¶ approach endorses contributing back to society from which it draws resources, and communicates the impact of its initiatives to all stakeholders.
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Branches ? In India Northern Region New Delhi Eastern Region Kolkata Western Region Mumbai Indore Pune Raipur Na gpur Ahmedabad SouthernRegion Bangalore Hyderabad Chennai Madurai Salem Cochin Coimbatore
Chandigarh Jaipur Lucknow ? In world ? ? ? ? ? ? ? ? ? UK South Korea Russia Europe Africa the Middle East South East Asia South Asia South America
Orissa Patna
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Acquisitions
In 2004 Tata Motors acquired Daewoo's truck manufacturing unit, now known as Tata Daewoo Commercial Vehicle, in South Korea. In 2005, Tata Motors acquired 21% of Aragonese Hispano Carrocera giving it controlling rights of the company. In 2007, Formed a joint venture with Marcopolo of Brazil and introduced low floor buses in the Indian Market. In 2008, Tata Motors acquired British Jaguar Land Rover (JLR), which includes the Daimler and Lanchester brand names In 2010, Tata Motors acquired 80% stake in Italy-based design and engineering company Trilix for a consideration of ¼1.85 million. The acquisition is in line with the company¶s objective to enhance its styling/design capabilities to global standards.
Expansion
The FIRST generation Tata Indica V2's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger vehicle market in 1991 by launching the Tata Sierra, a multi utility vehicle. After the launch of three more vehicles, Tata Estate (1992, a stationwagon design based on the earlier
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'TataMobile' (1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998, India's first sports utility vehicle). Tata launched the Indica in 1998, the first fully indigenous passenger car of India. Though the car was initially planned by auto-analysts, the car's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. A newer version of the car, named Indica V2, was a major improvement over the previous version and quickly became a mass-favorite. Tata Motors also successfully exported large quantities of the car to South Africa. The success of Indica in many ways marked the rise of Tata Motors.
Subsidiary brands
Jaguar
Tata Prima Truck
Hispano at the 2008 FIAA Land Rover in Madrid
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Tata Daewoo Commercial Vehicle Main article: Tata Daewoo Commercial Vehicle Tata Motors aimed to increase its presence worldwide. In 2004, it acquired the Daewoo Commercial Vehicle Company of South Korea. The reasons behind the acquisition were:
Company's global plans to reduce domestic exposure. The domestic commercial vehicle market is highly cyclical in nature and prone to fluctuations in the domestic economy.The company plans to diversify into various markets across the world in both MHCV as well as LCV segments.
To expand the product portfolio Tata Motors recently introduced the 25MT GVW Tata Novus from Daewoo¶s (South Korea) (TDCV) platform. Tata plans to leverage on the strong presence of TDCV in the heavy-tonnage range and introduce products in India at an appropriate time. This was mainly to cater to the international market and also to cater to the domestic market.
Tata remains India's largest heavy commercial vehicle manufacturer and Tata Daewoo is the 2nd largest heavy commercial vehicle manufacturer in South Korea. Tata Motors has jointly worked with Tata Daewoo to develop trucks such as Novus and World Truck and buses namely, GloBus and StarBus
Jaguar Cars and Land Rover Main articles: Jaguar Cars and Land Rover
After the acquisition of the British Jaguar Land Rover (JLR) business, which also includes the Daimler, Lanchester and Rover brands, Tata Motors became a major player in the international automobile market. On 27 March 2008, Tata Motors reached an agreement with Ford to purchase their Jaguar Land Rover operations for US$2.3 billion. The sale was completed on 2 June 2008.
In addition to the brands, Tata Motors has also gained access to two design centres and two plants in UK. The key acquisition would be of the intellectual property rights related to the technologies.
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Joint ventures
Tata MarcoPolo released a low-floor bus in India and now it is widely used as public transport in Delhi, Mumbai, Chennai, Bangalore, Chandigarh and Lucknow. Tata Motors has formed a 51:49 joint venture in bus body building with Marcopolo of Brazil. This joint venture is to manufacture and assemble fully-built buses and coaches targeted at developing mass rapid transportation systems. The joint venture will absorb technology and expertise in chassis and aggregates from Tata Motors, and Marcopolo, will provide know how in processes and systems for bodybuilding and bus body design. Tata and Marcopolo have launched a low-floor city bus which is widely used by Chennai, Coimbatore Delhi, Mumbai, Lucknow and Bengaluru transport corporations. Its manufacturing facility is based in Dharwad. Tata Motors also formed a joint venture with Fiat and gained access to Fiat¶s diesel enginetechnology.Tata Motors sells Fiat cars in India through a 50/50 joint venture Fiat Automobiles India Limited, and is looking to extend its relationship with Fiat and Iveco to other segments. Tata has also formed several JV's with many small companies in various countries around the world.
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Important developments Tata Nano Main article: Tata Nano
Tata Nano In January 2008, Tata Motors launched Tata Nano, the least expensive production car in the world at about 120,000 (US $3000). The city car was unveiled during the Auto Expo 2008 exhibition in Pragati Maidan, New Delhi. Tata has faced controversy over developing the Nano as some environmentalists are concerned that the launch of such a low priced car could lead to mass motorization in India with adverse effects on pollution and global warming. Tata has set up a factory in Sanand, Gujarat and the first Nanos are to roll out summer 2009. Tata Nano Europa has been developed for sale in developed economies and is to hit markets in 2010 while the normal Nano should hit markets in South Africa, Kenya and countries in Asia and Africa by late 2009. A battery version is also planned.
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Main Target:-
Tata Ace Main article: Tata Ace
Tata Ace was India's first mini truck Tata Ace, India's first indigenously developed sub one ton mini-truck, was launched in May 2005. The mini truck was a huge success in India with auto analysts claiming that Ace had changed the dynamics of the light commercial vehicle (LCV) market in the country by creating a new market segment termed the small commercial vehicle (SCV) segment. Ace rapidly emerged as the first choice for transporters and single truck owners for city and rural transport. By October 2005, LCV sales of Tata Motors had grown by 36.6 percent to 28,537 units due to the rising demand for Ace. The Ace was built with a load body produced by Autoline Industries. Ace is still a top seller for TML with 5 lakh units sold to date (June 2010).
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Ace has also been exported to several Asian, European, South American and African countries and all electric models are sold through Chrysler's Global Electric Motorcars division. In Sri Lanka it is sold through Diesel & Motor Engineering(DIMO) under the name of DIMO Batta.
Compressed air car Main article: Tata OneCAT
Tata OneCAT Motor Development International of France has developed the world's first prototype of acompressed air car, named OneCAT. In 2007, MDI owner Guy Negre was reported to have "the backing of Tata". It has airtanks that can be filled in 4 hours by plugging the car into a standard electrical plug. In 2008 MDI planned to also design a gas station compressor, which would fill the tanks in 3 minutes.There are no gasoline costs and no fossil fuel emissions from the vehicle when run in town, but "the compressed air driving the pistons can be boosted by a fuel burner". OneCAT is a five seat vehicle with a 200 litre (7.1 cu ft) trunk. With full tanks it is said to run at 100 km/h (62 mph) for 90 kilometres (56 mi) range in urban cycle. There are severe physical arguments pleading against those figures. In December 2009 Tata's vice president of engineering systems confirmed that the limited range and low engine temperatures were causing difficulties.
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Electric vehicles Tata Motors unveiled the electric versions of passenger car Tata Indica and commercial vehicle Tata Ace. Both run on lithium batteries. The company has indicated that the electric Indica would be launched locally in India in about 2010, without disclosing the price. The vehicle would be launched in Norway in 2009.
Four CNG - Electric Hybrid low floored Star buses to be used for Commonwealth games. These are the first Environmentally friendly buses to be used for public transportation in India.
Operations
The Tata Safari DiCOR is one of Tata's best selling vehicles in India and also has been fairly successful in the Mediterranean and Eastern Europe
Tata has tried to revamp all its models in order to satisfy the consumer
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The purchase of Jaguar and Land Rover is expected to help give Tata Motors gain a foothold in the European and American markets.
Tata relies on its subsidiaries for sales outside India. Seen here is the Range Rover Sport.
Tata Xenon is Tata's best selling vehicle in Europe.
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Tata in India
A loaded Tata truck on a Rajasthanhighway Tata Motors Limited is India¶s largest automobile company, with revenues of 35,651.48 crore (US$7.91 billion) in 2007-08.[29]It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles in India with products in the compact, midsize car and utility vehicle segments.Tata vehicles are sold primarily in India, and over 4 million Tata vehicles have been produced domestically since the first Tata vehicle was assembled in 1954. The company¶s manufacturing base in India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, Tata set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains. The company is establishing a new plant at Sanand (Gujarat). Tata's dealership, sales, service and spare parts network comprises over 3500 touch points. Tata Motors also distributes and markets Fiat branded cars in India. Sales & Service Network Tata Motors has more than 250 dealerships in more than 195 cities across 27 states and 4Union Territories of India It has the 3rd largest Sales and Service Network after Maruti Suzuki and Hyundai. Tata's global operations Tata Motors has been in the process of acquiring foreign brands to increase its global presence. Through acquisition, Tata has operations in the UK, South Korea, Thailand and Spain. Among these acquisitions is Jaguar Land Rover, a business comprising two struggling iconic British brands that was acquired from the Ford Motor Company in 2008. In 2004, Tata acquired the Daewoo Commercial Vehicles Company, South Korea¶s second largest truck maker. The rebranded Tata Daewoo Commercial Vehicles Company has launched several new products in the Korean market, while also exporting these products to several international markets. Today two thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. In 2005, Tata Motors acquired a 21% controlling stake in Hispano Carrocera, a Spanish bus and coach manufacturer. Tata Motors continued its market area expansion through the introduction of new products such as buses (Starbus & Globus, jointly developed with subsidiary Hispano Carrocera) and trucks (Novus, jointly developed with subsidiary Tata Daewoo). In May, 2009 Tata unveiled the Tata World Truck range jointly
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developed with Tata Daewoo Debuting in South Korea, South Africa, the SAARC countries and the MiddleEast. Tata formed a joint venture with the Brazilbased Marcopolo to manufacture fully built buses and coaches for India and other international markets. Tata Motors has expanded its production and assembly operations to several other countries including South Korea, Thailand, South Africa and Argentina and is planning to set up plants in Turkey, Indonesia and Eastern Europe. Tata also has franchisee/joint venture assembly operations in Kenya, Bangladesh, Ukraine, Russia and Senegal.Tata has dealerships in 26 countries across 4 continents Though Tata is present in many countries it has only managed to create a large consumer base in the Indian Subcontinent, namely India, Bangladesh, Bhutan, Sri Lanka and Nepal. Tata has a growing consumer base in Italy, Spain and South Africa.
Products Passenger cars and utility vehicles
Tata Prima concept car
Tata Nano Europa
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Tata Starbus Low Floor 1610
Tata Marcopolo buses in the Delhi BRT.
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Tata Aria Products:
Tata Sierra (Discontinued) Tata Estate (Discontinued) Tata Sumo/Spacio Tata Sumo Grande Tata Safari Tata Indica Tata Vista Tata Indigo Tata Manza Tata Indigo Marina Tata Winger Tata Magic Tata Nano Tata Xenon XT Tata Aria Tata Venture Tata Iris
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Concept vehicles
2000 Aria Roadster 2001 Aria Coupe 2002 Tata Indiva 2004 Tata Indigo Advent 2005 Tata Xover 2006 Tata Cliffrider 2007 Tata Elegante 2009 Tata Pr1ma 2010 Tata Versa 2010 Tata Essota 2011 Tata Pixel
Commercial vehicles
Tata Ace Tata TL/Telcoline/207 DI Pickup Truck Tata 407 Ex and Ex2 Tata 709 Ex Tata 809 Ex and Ex2 Tata 909 Ex and Ex2 Tata 1109 (Intermediate truck) Tata 1512 (Medium bus chassis) Tata 1612/1616 (Heavy bus chassis) Tata 1618 (Semi Low Floor bus chassis)
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Tata 1623 (Rear Engined Low Floor bus chassis) Tata 1613/1615 (Medium truck) Tata 2515/2516 (Medium truck) Tata Starbus (Branded Buses for city, inter city, school bus and standard passenger transportation) Tata Divo (Fully built luxury coach) Tata CityRide (12 - 20 seater buses for intra-city use) Tata 3015 (Heavy truck) Tata 3118 (Heavy truck) (8×2) Tata 3516 (Heavy truck) Tata 4018 (Heavy truck) Tata 4923 (Ultra-Heavy truck) (6×4) Tata Novus (Heavy truck designed by Tata Daewoo) Tata Prima (The World Truck designed by Tata Motors and Tata Daewoo)
Military vehicles
Tata LSV (Light Specialist Vehicle) Tata Mine Protected Vehicle (4×4) Tata 2 Stretcher Ambulance Tata 407 Troop Carrier, available in hard top, soft top, 4×4, and 4×2 versions Tata LPTA 713 TC (4×4) Tata LPT 709 E Tata SD 1015 TC (4×4) Tata LPTA 1615 TC (4×4) Tata LPTA 1621 TC (6×6)
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MILESTONES ACHIEVED
1945: Tata Engineering and Locomotive Company Limited was established to manufacture locomotives and other engineering products. 1948: Stem road roller introduced in collaboration with Marshall sons (UK). 1954: Collaboration with Daimler Benz AG, W.Germany, for manufacture of medium commercial vehicles. The first vehicle rolled out with in 6 months of the contract. 1959: Research and Development Center set up at Jamshedpur. 1961: Exports began with the first truck being shipped to Ceylon, Now Srilanka. 1966: Setting up of the engineering research center at pune to provide impacts to automobile research and development. 1971: Introduction of DI engines. 1977: First commercial vehicle manufactured in Pune. 1983: Manufacture of heavy commercial vehicle commences. 1985: First hydraulics excavator produced with Hitachi collaboration. 1986: Production of first light commercial vehicle, Tata 407, indigenously designed followed by Tata 608.
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1991: Launch of the first indigenous passenger car of Tata Siera. One million vehicles rolled out. 1992: Launch of Tata estate. 1993: Joint venture agreement signed with Cummins Engine Co. inc. Power and emission friendly diesel engines. 1994: Launch of Tata Sumo. The multi utility vehicle. Joint venture agreement signed with M/s. Daimler Benz / Mercedes Benz for manufacture of Mercedes Benz passenger cars in India. Joint venture agreement signed with Tata Holset Ltd., U.K. for manufacturing turbo chargers to be used on Cummins engines. 1995: Mercedes Benz Car E 220 launched. 1997: Tata Sierra Turbo launched 10000,000th Tata sumo rolled out. 1998: Tata Safari ± India¶s first sports utility vehicle launched. 2 million vehicles rolled out. Indica, India¶s first fully indigenous passenger car launched. 1999: 115,000 bookings for Indica registered against full payment within a Week. Commercial production of Indica commences in full swing. 2000: First consignment of 160 Indicas shipped to Malta. Indica with Bharat stage 2 (Euro II) complaint diesel engine launched. Launch of CNG buses. 2001: Indica V2 launched 2nd generation indica Indica V2 becomes Indian¶s number one car in its segment.
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2002: Unveiling of the Tata Sedan at Auto Expo 2002. 5,00,000th passenger vehicle rolled out. Tata Engineering signed a product agreement with M G Rover of the UK. 2003: The Tata indigo station wagon unveiled at the Geneva motors show. On 29th July J.R.D Tata¶s birth anniversary, Tata Engineering¶s becomes Tata Motors Limited. 2004: Tata Motors and Daewoo Commercial Vehicle Co. Ltd. sign investment Agreement. Tata Motors completes acquisition of Daewoo Commercial Vehicle Company. Tata Daewoo Commercial Vehicle Co. Ltd. (TDCV) launches the heavy duty truck 'NOVUS' , in Korea. Tata Motors lists on the NYSE. 2005:
Tata Motors rolls out the 500,000th Passenger Car from its Car Plant Facility in Pune Branded buses and coaches - Starbus and Globus - launched Tata Motors acquires 21% stake in Hispano Carrocera SA, Spanish bus manufacturing Company Tata Motors wins JRD QV award for business excellence. Inauguration of new factory at Jamshedpur for Novus Tata TL 4X4, India's first Sports Utility Truck (SUT) is launched Launch of Tata Novus Launch of Novus range of medium trucks in Korea, by Tata Daewoo Commercial Vehicle Co. (TDCV)
2006: Tata Motors and Marcopolo, Brazil, announce joint venture to manufacture fully built buses & coaches for India & markets abroad. Tata Motors first plant for small car to come up in West Bengal. Tata Motors extends CNG options on its hatchback and estate range. TDCV develops South Korea's first LNG-Powered Tractor- Trailer. Tata Motors and Fiat Group announce three additional cooperation. Agreements. 2007: Construction of Small Car plant at Singur, West Bengal, begins on January 21. Tata Motors and Thonburi Automotive Assembly Plant Co. (Thonburi),announce formation of a joint venture company in Thailand to manufacture,assemble and market pickup trucks. Tata-Fiat plant at Ranjangaon inaugurated. Fiat Group and Tata Motors announce establishment of Joint Venture in India.
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2008: 2009: 2010:
Ace plant at Pantnagar (Uttarakhand) begins production. Indica Vista ± the new generation Indica, is launched. Tata Motors' new plant for Nano to come up in Gujarat. Tata Motors unveils its People's Car, Nano, at the ninth Auto Expo. Xenon, 1-tonne pick-up truck, launched in Thailand. Tata Motors signs definitive agreement with Ford Motor Company to purchase Jaguar and Land Rover. Tata Motors completes acquisition of Jaguar Land Rover. Tata Motors is Official Vehicle Provider to Youth Baton Relay for TheIII Commonwealth Youth Games Pune 2008.
Tata Marcopolo Motors, Dharwad plant beings production Tata Motors launches Nano - The People's Car Launch of premium luxury vehicles - Jaguar XF, XFR and XKR and Land Rover Discovery 3, Range Rover Sport and Range Rover from Jaguar and Land Rover in India Tata Nano wins the Indian Car of the Year (ICOTY) Award Tata Motors acquires remaining 79% in Hispano Carrocera.
Appointment of Mr. Carl-Peter Forster as Managing Director of Tata Motors. Tata Motors to construct heavy truck plant in Myanmar under Government of India¶s Line of Credit. Tata Motors declared as the Commercial Vehicle Maker of the Year. Tata Motors Passenger Car Division launches µTata Motors Service Edge¶ for leading edge customer service. Chief Minister of Punjab inaugurates Tata Motors supported State Institute of Automotive and Driving Skills. Tata Motors appoints Mr. Carl-Peter Forster as Group CEO.
Tata Motors Group displays the widest range of products and environment friendly technologies at Auto Export 2010.
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Facts And Figures
FINANCIAL PERFORMANCE SUMMARY OPERATING RESULTS AND PROFITS After the economic downturn and difficult market conditions in the automotive sector globally in 2008-09, during the year, economies across the world (with a few exceptions) showed signs of recovery and growth. The Indian economy bounced back quickly and strongly growing at 7.2% in 2009-10. The automotive sector in India started the year steadily, gathered momentum in different segments in the second half of the year and ended the year with a record growth and performance. The Company¶s turnover, in this background and with a strong portfolio coupled with successful launch of new products and variants in commercial vehicles and passenger vehicles, was Rs.38,364 crores, a growth of 34.3% over the previous year. The volume growth coupled with other actions on pricing and cost reduction enabled the Company to achieve significant improvement in EBIDTA margin to 11.7% (6.8% in 2008-09). The Profit Before Tax of Rs.2,830 crores and Profit After Tax of Rs.2,240 crores also grew significantly over the previous year by 179.1% and 123.7% respectively. The Tata Motors¶ Group turnover was Rs.95,567 crores, a growth of 29% over previous year contributed mainly by market recovery, improved realization and successful launch of new products. Consolidated Profit Before Tax was Rs.3,523 crores (Loss of Rs.2,129 crores in 2008-09) and Consolidated Profit for the year was Rs.2,571 crores (Loss of Rs.2,505 crores in 2008-09).
VEHICLE SALES AND MARKET SHARES The Company recorded a sale of 633,862 vehicles in 2009-10, a growth of 34% over previous year (472,885 vehicles) in the domestic market in India, representing a 25.5% share in the industry (improving from 24.4% share in the previous year). Commercial vehicle sales were highest ever at 373,842 vehicles achieving a robust growth of 40.9% over previous year and a market share of 64.2% (a gain of 0.4%, over previous year). A strong product portfolio, successful launch of new products and variants, extensive efforts in marketing and finance enablement for customers and leadership in market research and penetration, contributed to the significant improvement in overall performance. Some of the key highlights were:- In M&HCV, growth of 36.5% to 155,161 vehicles and a market share improvement to 63.3% (from 61.9% in the previous year); launch of the next generation of heavy trucks - Prima range; completion of delivery of 1,625 low entry buses to Delhi Transport Corporation and delivery of major portion of the orders of over 5,000 buses under JnNURM Scheme of Government of India for modernizing the public transport in India. - The Light Commercial Vehicle (LCV) sales recorded a spectacular growth of 45.4% in FY 2009-10. While this was largely aided by the growth in the small commercial vehicles, the rest of the segment also grew handsomely. The competition in the small commercial vehicle range increased resulting in a 0.5% loss in the domestic market share reducing it to 64.8%. The Company¶s sales increased by 44.2% to 218,681 LCVs. The Company launched new variants on the Ace platform, Ace EX, Super Ace and the 407 Pickup which are expected to help in gaining volumes.
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Passenger vehicle sales were 260,020 vehicles, highest ever, achieving a growth of 25.3% over previous year and a market share of 13.7% (stable compared to 13.6% in the previous year). The Company continues to be amongst the top three players in the passenger vehicle market which has over 25 players. The growing sales of the new generation Indica Vista and successful launch and market response for the Indigo Manza mainly contributed to the growth. Some of the key highlights were: - In the Small Car segment, increase in market share to 13.3% (as against 12.7%, in the previous year), with the growing sales of Indica Vista, sales of the Nano and the Fiat Punto; - Commencement of sales of Nano in July 2009 and completing deliveries of 30,763 cars to the customers and commencement of trial production in the Sanand plant. - The Indigo range sales of 54,551 units, a growth of 10.9% over the previous year and also the highest ever sales by the Company in this range, mainly due to the launch of the Indigo Manza in October 2009. - Sale of 33,507 Multi-Utility Vehicles (MUVs), a decline of 14.7% against the last year and as a result the market share dropped to 12.4%. The Grande Mk II which was launched in December 2009 has been well accepted in the market and is expected to help in regaining market share in the UV segment. Sale of 24,884 Fiat cars which has given Fiat a 1.3% market share as against 0.5% in the previous year with Linea sales at 11,102 nos. (a segment share of 10.1%) and the Grande Punto sales at 13,281 (a segment share of 3.5%). - The Company sold 225 Jaguar and Land Rover vehicles through its exclusive dealerships in India in the first year of the sales of the Jaguar Land Rover brands. The Company¶s international business remained affected by the economic downturn in many of the key markets. The Company¶s commercial vehicle exports grew moderately by 4.7% to 27,878 vehicles and passenger vehicles exports declined by 9.9% to 6,231 vehicles. With improved economic outlook and market recovery and with the new product range, the Company expects significant improvement in its international business in the future. Tata Motors¶ Group sales were 880,396 vehicles across its entire range of products and markets. The key highlights were: - The Company has sold 667,971 vehicles. - Jaguar Land Rover achieved sale of 193,982 vehicles as compared to 167,348 vehicles in 2008-09 (in 10 months since Tata Motors acquisition of the business in June 2008). Jaguar Land Rover continued to enhance its product offerings through an all new XFR, powertrain offerings and 2010 model year vehicles. The new Jaguar XJ was unveiled in London in July 2009 and had its public debut at the Frankfurt Motor Show in September 2009. - In South Korea, Tata Daewoo Commercial Vehicle Company Limited (TDCV) successfully launched the new premium truck platform ± Prima; TDCV sales were stagnant at 9,011 vehicles in Korea and international markets as compared to 9,137 vehicles in the previous year. - In Thailand, Tata Motors (Thailand) Limited saw a very good response to the CNG version of the Tata Pickup vehicle ± Xenon.
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PESTEL ANALYSIS
Political: Since Tata Motors operates in multiple countries across Europe, Africa, Asia, the Middle East, and Australia, it needs to pay close attention to the political climate but also laws and regulations in all the countries it operates in while also paying attention to regional governing bodies. Laws governing commerce, trade, growth, and investment are dependent on the local government as well as how successful local markets and economies will be due to regional, national and local influence. In accordance, Tata¶s headquarters in Mumbai, India, strictly controls and regulates operations in all dealerships and subsidiaries, in addition to knowing and abiding by all labor laws in the multiple countries where they have manufacturing plants it has to watch political change. Economic: Operating in numerous countries across the world, Tata Motors functions with a global economic perspective while focusing on each individual market. Because Tata Motors is in a rapid growth period, expanding or forming a joint venture in over five countries world-wide since 2004, a global approach enables Tata Motors to adapt and learn from the many different regions within the whole automotive industry. They have experience and resources from five continents across the globe, thus when any variable changes in the market they can gather information and resources from all over the world to address any issues. For instance, if the price of the aluminium required to make engine blocks goes up in Kenya, Tata has the option to get the aluminium from other suppliers in Europe or Asia who they would normally get from for production in Ukraine or Russia. Tata Motors also has to pay close attention to shifts in currency rates throughout the world. Currency fluctuations can equate to higher or lower demands for Tata vehicles which in turn affect profitability. It can also mean a rise in costs or a drop in returns. But they also have to pay attention to not just the domestic currency, the rupee, but also to the dollar, euro, bhat, won, and pound, to just name a few. Just because the rupee is strong against the dollar does not mean it is strong against all the other currencies. Attention to currency is important because it influences where capital investment will develop and prosper. Social : Undoubtedly, the beliefs, opinions, and general attitude of all the stakeholders in a company will affect how well a company performs. This includes every stakeholder from the CEO and President, down to the line workers who screw the door panel into place, from the investor to the customer, the culture and attitude of all these people will ultimately determine the future of a company and whether they will be profitable or not. For this reason, Tata Motors tends to use an integration and rarely separation technique with foreign companies they acquire. In 2004, Tata Motors acquired Daewoo Commercial Vehicles Company, which was at the time Korea¶s second largest truck maker. Rather than using de-culturation or assimilating Daewoo, Tata took an integrated approach, and continued building and marketing Daewoo¶s current models as well as introducing a few new models globally just as it had been done under Korean management.
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Technology: Tata Motors and its parent company, the Tata Group, are ahead of the game in the technology field.³The foundation of the company¶s growth is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customer-desired offerings through leading edge R&D´ (Tata). Employing 1,400 scientists and engineers, Tata Motors¶ Research and Development team is ahead of the pack in India¶s market and right with the rest of the field internationally. Among Tata¶s firsts are ³the first indigenously developed Light Commercial Vehicle, India's first Sports Utility Vehicle and, in 1998, the Tata Indica, India's first fully indigenous passenger car,´ as well as the increasingly famous Tata Nano, which is projected to be the world¶s cheapest production car (Tata). In the automotive industry, it is becoming increasingly crucial for manufacturers to stay on top of the technology curve with new problems always rising such as escalating gas prices and pollution problems. Tata recognizes this and dedicates lots of resources and time into research and development to be even with or preferably ahead of other competitors, global trends, and changing economies. In all, an automobile manufacturer must change, adapt, and evolve to stay competitive in the automotive game, and this is exactly what Tata is doing with their rapid growth, and extensive research and development. Environmental: Environmental factors include the weather and climate change. Changes in temperature can impact on many industries including farming, tourism and insurance. With major climate changes occurring due to global warming and with greater environmental awareness this external factor is becoming a significant issue for firms to consider. Tata Motors has been making conscious effort in the implementation of several environmentally sensitive technologies in manufacturing processes. The Company uses some of the world's most advanced equipment for emission check and control. Tata Motors concern is manifested by a dual approach 1) Reduction of environmental pollution and regular pollution control drives 2) Restoration of ecological balance. Tata Motors is committed to restoring and preserving environmental balance, by reducing waste and pollutants, conserving resources and recycling materials. Reducing Pollution: Tata Motors has been at the forefront of the Indian automobile industry's anti-pollution efforts by introducing cleaner engines. It is the first Indian Company to introduce vehicles with Euro norms well ahead of the mandated dates. Tata Motors' joint venture with Cummins Engine Company, USA, in 1992, was a pioneering effort to introduce emission control technology for India. Over the years, Tata Motors has also made investments in setting up of an advanced emission-testing laboratory.
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With the intention of protecting the environment, Tata Motors has upgraded the performance of its entire range of four and six cylinder engines to meet international emission standards. This has been accomplished with the help of world-renowned engine consultants like Ricardo and AVL. These engines are used in Tata Motors vehicles in the Indian market, as well as in over 70 export markets. Tata Motors is constantly working towards developing alternative fuel engine technologies. It has manufactured CNG version of buses and followed it up with a CNG version of its passenger car, the Indica. Restoring Ecological Balance: Tata Motors has set up effluent treatment facilities in its plants, to avoid release of polluted water into the ecosystem. In Pune, the treated water is conserved in lakes attracting various species of birds from around the world thus turning the space into a green belt. Tree plantation programmes involving villagers and Tata Motors employees, have turned acres of barren village green. Tata Motors has planted as many as 80,000 trees in the works and the township and more than 2.4 million trees have been planted in Jamshedpur region. Over half a million trees have been planted in the Poona region. Tata Motors has directed all its suppliers to package their products in alternate material instead of wood. End of Life Vehicle Treatment and Recycling: India is a recycling society with many people making value out the recovery of waste materials discarded from products at the end of their useful life. However, Europe, and some other export markets, have recognised that they have become a 'throwaway' society in recent decades, and are now introducing waste prevention regimes in different industry sectors to collect and recycle valuable resource rather than it ending up in landfill. In the Automotive sector, the European End of Life Vehicle (ELV) Directive, points responsibility for this issue to vehicle manufacturers, and the scrap car recovery industry. Similar regulations are being introduced in Japan and Korea. Naturally, Tata Motors has already met the 'producer responsibility' aspects of the ELV Directive, such as compliance to Heavy metals and other hazardous substance restrictions. Also, material code marking of plastic parts has been introduced to aid achievement of demanding European recycling targets. Legal: The constitution of India and the laws enacted there under, enshrine Human Rights as fundamental rights. These are duly reflected with adequate provision for their protection in the various labour laws in the country. The Tata Code of Conduct sets out guidelines on compliance with all regulatory requirements and also on specific issues, which in sum is the articulation of Tata Motors policy on Human Rights. The Tata Code of Conduct also clearly states that wherever, the laws are more lenient than the Code, the Code shall prevail. Locational Ethics counsellors have been appointed to deal with any concerns raised pertaining to clauses mentioned in the Tata Code of Conduct. A monitoring system is in place to ensure compliance with the Code. Corrective actions are taken at process and/or system levels as appropriate. Tata Motors Limited has Supplier and Dealer assessment process to take care of issues related to social aspects before inducting them in organisation. All legal and regulatory requirements need to be fulfilled before final selection into the Tata Motors fold. The company periodically audits the job contractors for adherence to labour laws and other statutory requirement like minimum wages, PF, payment of gratuity etc. thereby ensuring prevention of violation of Human rights and employment malpractice. Tata Motors has a special contracts cell and price panel, which conducts regular compliance audits of contractors and suppliers to ensure their adherence to legal enactment, thereby ensuring
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prevention of violation of Human rights and employment malpractice. In keeping with the spirit of the Constitution of India wherein Right of Association is a Fundamental Right, Tata Motors respects the right for association of its employees and has constructive relationship with trade unions at all locations. Employees are encouraged to join the Trade Unions, as it believes that most individual and collective grievances can be resolved through bipartite forums. This has led to good industrial relations. With its collaborative approach to company union, Tata Motors has not faced legal action regarding anti-union practices. Approximately 15000 of Tata Motor¶s permanent employees, who come under the unionised category, are covered by collective bargaining agreements. These agreements include health and safety provisions along with compensation structures in the form of a Memorandum of Understanding (MoU) between the management and the representing Union as per the provisions of the applicable labour legislations. These MoUs are signed every three years after negotiations between representing committees of the union and the Management. While the union membership may vary from each location, all eligible employees, irrespective of his membership, enjoy the benefits as agreed in the MoU. While the existing grievance handling process takes care of issues of temporary employees, the recognised Unions also take up their issues. Tata Motors strictly adheres to the laws of the land with regard to forced and compulsory labour. The statutory regulations like Contract Labour Act, the Factories Act and the tripartite/ bi-partite settlement between the management and the union every three years serve as a legal binding force. The disciplinary action process at Tata Motors is as per the applicable laws like Model Standing Orders / Certified Standing Orders that allow the process of natural justice as per statute. Tata Motors upholds the Tata tradition of not employing children in any of its Companies. It is bound by the statutory legislation (Factories Act, 1948) and proper records are maintained in this regard. The Certified Standing Orders of the Company expressly state that the age of an employee at the time of recruitment should be 18 years or more. TCOC clause on equal opportunities is the basis to prevent all forms of discrimination. In addition, Tata Motors has formalised policy statements on Human Rights, Sexual Harassment, Equal Opportunities, and Corporate Social Responsibility.
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Core Competency:
Tata Motors is able to maintain, as well as increase, their market shareby capitalizing on their core competencies. Tata Motors is active, competitive, and dynamic in all aspects of the automotive industry, which means that there must be many different activities going on inall areas of the company. As a result of the ever evolving automotive industry Tata Motors must always be changing and one way to stay at the forefront of the industry is to make continuous improvements in technology through research and development. One way that TataMotors has done this is by producing one of the most efficient and low cost vehicles on the market. Acquisitions, mergers, and expansion is another core competency that Tata Motors has is embedded in their company structure and philosophy. Another core competency that TataMotors holds is being located in the India. This location has allowed them to understand not only the Indian market but also the dynamics of emerging and developing markets.This market understanding and knowledge allows Tata Motors to manufacture their products at lower costs, sell them to emerging markets while making profits as well as take advantage of the strong labor base in India.
Sharing of Skills/Core Competence
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SWOT Analysis:
Strengths
y
y
y
y y y y y y y
The internationalisation strategy so far has been to keep local managers in new acquisitions, and to only transplant a couple of senior managers from India into the new market. The benefit is that Tata has been able to exchange expertise. For example after the Daewoo acquisition the Indian company leaned work discipline and how to get the final product 'right first time.' The company has a strategy in place for the next stage of its expansion. Not only is it focusing upon new products and acquisitions, but it also has a programme of intensive management development in place in order to establish its leaders for tomorrow. The company has had a successful alliance with Italian mass producer Fiat since 2006. This has enhanced the product portfolio for Tata and Fiat in terms of production and knowledge exchange. For example, the Fiat Palio Style was launched by Tata in 2007, and the companies have an agreement to build a pick-up targeted at Central and South America. Excellent brand equity and image in Indian market. Sound global recognition in light trucks and buses. Sound fundamentals in turbo diesel because of their joint venture with Cummins Good Presence in Indian Markets Ownership of heritage of British motor brands like land Rover and Jaguar. Strategic tie up with Benz .They follow premium segment marketing World class quality accreditation(ISO 9001; ISO 20000)
Weaknesses
y y
y
y y y y y y
The company's passenger car products are based upon 3rd and 4th generation platforms, which put Tata Motors Limited at a disadvantage with competing car manufacturers. Despite buying the Jaguar and Land Rover brands (see opportunities below); Tat has not got a foothold in the luxury car segment in its domestic, Indian market. Is the brand associated with commercial vehicles and low-cost passenger cars to the extent that it has isolated itself from lucrative segments in a more aspiring India? One weakness which is often not recognised is that in English the word 'tat' means rubbish. Would the brand sensitive British consumer ever buy into such a brand? Maybe not, but they would buy into Fiat, Jaguar and Land Rover (see opportunities and strengths). Never done well in UK; USA and European Markets. Not yet prepared fundamentally to handle global markets of Land Rover and Jaguar. Weak technical competencies. Perceived as Indianized. Do not possess localization skills outside Indian Markets. Focus in more on cost thus car lacks advanced features.
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Opportunities
y
y y
y
y
y y
In the summer of 2008 Tata Motor's announced that it had successfully purchased the Land Rover and Jaguar brands from Ford Motors for UK £2.3 million. Two of the World's luxury car brand have been added to its portfolio of brands, and will undoubtedly off the company the chance to market vehicles in the luxury segments. Tata Motors Limited acquired Daewoo Motor's Commercial vehicle business in 2004 for around USD $16 million. Nano is the cheapest car in the World - retailing at little more than a motorbike. Whilst the World is getting ready for greener alternatives to gas-guzzlers, is the Nano the answer in terms of concept or brand? Incidentally, the new Land Rover and Jaguar models will cost up to 85 times more than a standard Nano! The new global track platform is about to be launched from its Korean (previously Daewoo) plant. Again, at a time when the World is looking for environmentally friendly transport alternatives, is now the right time to move into this segment? The answer to this question (and the one above) is that new and emerging industrial nations such as India, South Korea and China will have a thirst for low-cost passenger and commercial vehicles. These are the opportunities. However the company has put in place a very proactive Corporate Social Responsibility (CSR) committee to address potential strategies that will make is operations more sustainable. The range of Super Milo fuel efficient buses are powered by super-efficient, eco-friendly engines. The bus has optional organic clutch with booster assist and better air intakes that will reduce fuel consumption by up to 10%. Introduce Asian variants of jaguar and Land Rover by promoting µ¶ Power Icon¶¶ Brand which will work well with Asian politicians. Develop more joint ventures like Tata Mercedes ± Benz.
Threats
y y
y
Other competing car manufacturers have been in the passenger car business for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in terms of quality and lean production. Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalises and buys into other brands this problem could be alleviated. Since the company has focused upon the commercial and small vehicle segments, it has left itself open to competition from overseas companies for the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and Toyota. In fact the entire Indian market has become a target for other global competitors including Maruti Udyog, General Motors, Ford and others.
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y
y y y y y
Rising prices in the global economy could pose a threat to Tata Motors Limited on a couple of fronts. The price of steel and aluminium is increasing putting pressure on the costs of production. Many of Tata's products run on Diesel fuel which is becoming expensive globally and within its traditional home market. Many companies across the world are busy developing their own models of Economy cars they may launch in competition with Tata motors Must catch in terms of Quality and lean production. Since company has focussed upon commercial and small vehicle segment it has left open to competition from overseas. Rising prices in global economy. Price of steel and aluminium is increasing putting pressure on costs of production.
Diesel fuel is becoming expensive globally.
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Future Plans
Major Future Plans 1. Capitalize on Tata Nano - Fast Delivery. 2. Launch New Commercial Vehicles. 3. Tie up with more State Govts. for Efficient & Safe City Buses at low cost. 4. Launch of Jaguar & Land rover Vehicles in India. 5. Bridge the outstanding loans. 6. Focus on Cost Reduction. 7. Expand Network. Future Challenges: ? ? ? ? Tata Motors relies heavily on its sales in India. Tata Motors now faces stiff competition from fellow compatriots like Mahindra, Maruti as well as multinational brands like Toyota and Chevrolet. It has faced controversy over developing the µNano¶ Ashok Leyland, Tata's biggest competitor in the Indian heavy commercial vehicle market .
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Suggestion And Conclusion
Suggestion: ? ? ? ? ? Should increase no of service centers. Should bring more variants. Easy availability of spare parts. Should increase no of outlets. Should employ skilled labour.
Conclusion: In a small segment consumer seeks for: ? ? ? ? Good mileage. Low maintenance. Easy availability of spare parts. Easy finance Price.
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References:
http://www.tata.com http://tatamotors.com http://www.wikipedia.com www.quickmba.com/strategy/porter.shtml www.presentationmagazine.com/rule-of-three-836.htm
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doc_623644816.docx
Project Report On ³ TATA Motors´
Submitted To:
Prof. Oberoi
Submitted By: Parin savla 36 01 45
(Prof. Global Financial Market Smit bagadia Richa singh
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Acknowledgement
I would like to express my special thanks of gratitude to my teacher .....as well as our principal who gave me the golden opportunity to do this wonderful project on the topic MNC, TATA MOTORS, which also helped me in doing a lot of Research and I came to know about so many new things I am really thankful to them. Secondly I would also like to thank my parents and friends who helped me a lot in finishing this project within the limited time. I am making this project not only for marks but to also Increase my knowledge
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Table of Contents
What is MNC? Introduction History of Tata Motor Branches Mission & Vision Milestones Achieved Facts & Figure PESTEL Analysis Core Competency SWOT Analysis Future Plans Suggestion And Conclusion References
04 06 07 11 26 27 31 33 37 38 41 42 43
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What are MULTI-NATIONAL COMPANIE¶S (MNC¶S) ? ? MNC¶s are huge industrial organizations which extend their industrial and marketing operations through a network of their branches or their Majority Owned Foreign Affiliates. MNC¶s are also know as Transnational Corporation (TNC¶s).
?
Features of MULTI-NATIONAL COMPANIE¶S? ? ? ? ? ? ? ? ? Huge intellectual capital Operates in many countries Large number of customer Large number of competitors Structured way of Big size Structured way of decision making Big size decision making
Advantages of MULTI-NATIONAL COMPANIE¶S. ? ? ? ? ? MNC¶s have become vehicles of technology to the developing countries Greater employment and career opportunities are provided by these MNC¶s. MNC¶s make commendable contribution to inventions and innovations in the host country. Practice of MNC¶s bring to the host country, the latest technique in the field of management. Varity of goods and services produced for local customers.
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Disadvantages of MULTI-NATIONAL COMPANIES. ? ? ? ? MNC¶s create monopolies in the market and eliminate local competitors. MNC¶s may create depletion of resources due to its continues use by these overseas companies. MNC¶s generally carry out their R&D in their home country and supply to the host country. MNC¶s generally import huge raw materials due to its continuous use by these overseas companies.
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Introduction
(NSE: TATAMOTORS, BSE: 500570, NYSE: TTM,NASDAQ: TTM) is a multinational automotive corporation headquartered in Mumbai, India. Part of the Tata Group, it was formerly known as TELCO (TATA Engineering and Locomotive Company). Tata Motors is India¶s largest automobile company, with consolidated revenues of USD 20 billion in 2009-10. It is the leader in commercial vehicles and among the top three in passenger vehicles. Tata Motors has products in the compact, midsize car and utility vehicle segments. The company is the world's fourth largest truck manufacturer, the world's second largest bus manufacturer, and employs 24,000 workers. Since first rolled out in 1954, Tata Motors has produced and sold over 4 million vehicles in India. Established in 1945, when the company began manufacturing locomotives, the company manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969. Tata Motors is a dual-listed company traded on both the Bombay Stock Exchange, as well as on the New York Stock Exchange. Tata Motors in 2005, was ranked among the top 10 corporations in India with an annual revenue exceeding INR 320 billion. In 2010, Tata Motors surpassed Reliance to win the coveted title of 'India's most valuable brand' in an annual survey conducted by Brand Finance and The Economic Times. Tata Motors has auto manufacturing and assembly plants in Jamshedpur, Pantnagar, Lucknow,Ahmedabad, Sanand, Dharwad and Pune in India, as well as in Argentina, South Africa and Thailand.
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History of Tata Motors: The Tata Group was founded in 1868 when India was under British Empire. The group formed their textile business in 1874 and Steel manufacturing in 1907. In 1945, Tata Sons Limited started the automotive business with manufacturing steam locomotive boilers after purchasing the shops of East Indian Railways from Government of India, which was under the British Government in that year.
After purchasing these shops, the Tata sons decided to establish Tata Engineering and Locomotive Company Limited (TELCO Limited) and establish the primary manufacturing facility in Jamshedpur (an industrial city in Eastern India). This company was managed by J.R.D. Tata from 1945 to 1973 and by Sumand Moolgaokar from 1973 to 1988.
Sumand established the second manufacturing facility in Pune India looking into the boom in the auto market. In 1991 Ratan Tata took over the Tata Empire from his uncle and moved the Tata group out of the sectors where they were not very competitive ± like Cement and Textiles. Today, Tata¶s largest manufacturing businesses are Steel and Motors after the consolidation carried out by Ratan Tata. As on end of financial year 2008, the Tata Group has an annual turnover in excess of $30 Billion out of which more than $9 Billion is contributed by Tata Motors.
TELCO Limited is now widely known as Tata Motors that is among the world¶s top five manufacturers of medium and heavy trucks and world¶s second largest manufacturer of medium and heavy busses. Tata possess a strategic engagement with Mercedes Benz for assembling and selling Mercedes Benz commercial vehicles and passenger cars in India.
Another strategic tie up that they possess is with Cummins pertaining to their diesel engines through Tata Holset Limited. In fact, Tata Motors contributed to the Cummins Diesel engines by adding turbo chargers on them vide their joint manufacturing operations with Tata Holset Limited.
The only partnership of Tata that didn¶t go well was with Rover Group of Britain that went bankrupt in year 2005. Tata tried entering the European markets through a model named CityRover that faired poorly due to its negative publicity, higher price and poor quality compared to the competition.Ratan Tata is now 70 years old
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but still presents the image of a dynamic, innovative and revolutionary entrepreneur. He is known for high aggressive moves for the benefits of Tata Motors customers. In 1997, Tata Motors launched its first indigenously developed car named Indica that currently possesses more than 15% of the car market share in India.
The other car models of Tata Motors that are popular in India and some markets of Asia are Tata Indigo, Tata Sierra, Tata Sumo and Tata Safari. In 2008, Tata achieved a global publicity due to two major activities that made headlines worldwide. In the Geneva Motor show they presented their four-seater small car named ³Nano´ priced about $2500 which is expected to be the cheapest car of the world.
In March 2008, Tata Motors acquired the two globally prestigious companies ± Jaguar and Land Rove from Ford Motor Company. It is assessed that Tata Motors did so to achieve a new image of a global automotive company like Ford Motor Company given that their business span has largely remained indigenous within India for a long time.
Mission: a) Passenger Car Business Unit ³ To provide passenger vehicles that offer customers exceptional value, and through this build a company that provides its shareholders with superior returns, and is seen by society & other stakeholders as a valuable contributor to their development´ b) Commercial Car Business Unit Shareholders To consistently create shareholder value by generating returns in excess of Weighted Average Cost of Capital(WACC) during the upturn & atleast equal to weighted average cost of capital(WACC) during the downturn of the business cycle. Customers To strengthen the Tata brand and create lasting relationships with the customers by working closely with business partners to provide superior volue for money over the life cycle.
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Employees To create a seamless organisation that incubates and promotes innovation, excellence and the tata core values. Vendor and channel partners To foster a long-term relationship so as to introduce a broad range of innovative products and services that would benefit our customers and other stake holders. Community To proactively participate in reshaping the country¶s economic growth. To take a holistic approach towards environmental protection.
Vision: a) Passenger Car Business Unit ³To evolve into a World Class Indian Car Brand.´ b) Commercial Vehicle Business Unit ³ To be a world class corporate constantly furthering the interest of all its shareholders.´ Core Values: a) Core Values of Passenger Car Business Unit Our core values are built upon the traditions of the Tata Group with emphasis on 1. Trust: We must have faith of the product that we make & to respect the value of our customer. 2. Integrity: We must conduct our business fairly, with honesty and transparency. Everything we do must stand the test of public scrutiny. 3. Concern for the well-being of both the employees & the society: We must continue to be responsible, sensitive to the countries, communities and environments in which we work, always ensuring that what comes from the people goes back to the people many times over.
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b) Core Values of Commercial Car Business Unit The core value of Commercial Vehicle Business unit are1. Integrity: We must conduct our business fairly, with honesty and transparency. Everything we do must stand the test of public scrutiny. 2. Customer Focus: We must understand the requirement of the customer & to continue to improve the quality of our product. 3. Corporate Citizenship: We must continue to have a global presence in the corporate world for becoming a global company. 4. Passion for Engineering: We must have a passion to innovate constantly in making our product. Sustainability The Tata Group is guided by the Principle of Trusteeship and the conviction that Free Enterprise, in order to thrive, must serve the needs of society. This is the cornerstone of our CS initiatives. Tata Motors is committed, in letter and spirit, to the improvement in the quality of life of people. Need for Proactive Stance Equally, Tata Motors believes in being proactive in achieving a balance between business growth and social and environment related needs. Hence, the company¶s business focus is both on personal and public transportation. Hence the company is itself working on or supporting development of alternate fuels, electric and hybrid vehicles, both for personal and public transportation. Need to go beyond Compliance Whether in pursuing its business growth or meeting its responsibilities, Tata Motors intent is to contribute by ³doing the right thing´ as against merely being compliant by ³not doing the wrong things´. Boost to Brand Image In a global syndicated study conducted by TNS across 18 major automotive markets, it was evident that general public¶s perception of a company¶s conduct is a strong reflection of the overall market sentiment towards that company. 94% of the Indian respondents and 89% of the respondents across the globe maintained that they were more likely to purchase a product or a service from a company that they believe follows responsible and ethical business practices. Tata Motors¶ approach endorses contributing back to society from which it draws resources, and communicates the impact of its initiatives to all stakeholders.
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Branches ? In India Northern Region New Delhi Eastern Region Kolkata Western Region Mumbai Indore Pune Raipur Na gpur Ahmedabad SouthernRegion Bangalore Hyderabad Chennai Madurai Salem Cochin Coimbatore
Chandigarh Jaipur Lucknow ? In world ? ? ? ? ? ? ? ? ? UK South Korea Russia Europe Africa the Middle East South East Asia South Asia South America
Orissa Patna
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Acquisitions
In 2004 Tata Motors acquired Daewoo's truck manufacturing unit, now known as Tata Daewoo Commercial Vehicle, in South Korea. In 2005, Tata Motors acquired 21% of Aragonese Hispano Carrocera giving it controlling rights of the company. In 2007, Formed a joint venture with Marcopolo of Brazil and introduced low floor buses in the Indian Market. In 2008, Tata Motors acquired British Jaguar Land Rover (JLR), which includes the Daimler and Lanchester brand names In 2010, Tata Motors acquired 80% stake in Italy-based design and engineering company Trilix for a consideration of ¼1.85 million. The acquisition is in line with the company¶s objective to enhance its styling/design capabilities to global standards.
Expansion
The FIRST generation Tata Indica V2's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger vehicle market in 1991 by launching the Tata Sierra, a multi utility vehicle. After the launch of three more vehicles, Tata Estate (1992, a stationwagon design based on the earlier
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'TataMobile' (1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998, India's first sports utility vehicle). Tata launched the Indica in 1998, the first fully indigenous passenger car of India. Though the car was initially planned by auto-analysts, the car's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. A newer version of the car, named Indica V2, was a major improvement over the previous version and quickly became a mass-favorite. Tata Motors also successfully exported large quantities of the car to South Africa. The success of Indica in many ways marked the rise of Tata Motors.
Subsidiary brands
Jaguar
Tata Prima Truck
Hispano at the 2008 FIAA Land Rover in Madrid
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Tata Daewoo Commercial Vehicle Main article: Tata Daewoo Commercial Vehicle Tata Motors aimed to increase its presence worldwide. In 2004, it acquired the Daewoo Commercial Vehicle Company of South Korea. The reasons behind the acquisition were:
Company's global plans to reduce domestic exposure. The domestic commercial vehicle market is highly cyclical in nature and prone to fluctuations in the domestic economy.The company plans to diversify into various markets across the world in both MHCV as well as LCV segments.
To expand the product portfolio Tata Motors recently introduced the 25MT GVW Tata Novus from Daewoo¶s (South Korea) (TDCV) platform. Tata plans to leverage on the strong presence of TDCV in the heavy-tonnage range and introduce products in India at an appropriate time. This was mainly to cater to the international market and also to cater to the domestic market.
Tata remains India's largest heavy commercial vehicle manufacturer and Tata Daewoo is the 2nd largest heavy commercial vehicle manufacturer in South Korea. Tata Motors has jointly worked with Tata Daewoo to develop trucks such as Novus and World Truck and buses namely, GloBus and StarBus
Jaguar Cars and Land Rover Main articles: Jaguar Cars and Land Rover
After the acquisition of the British Jaguar Land Rover (JLR) business, which also includes the Daimler, Lanchester and Rover brands, Tata Motors became a major player in the international automobile market. On 27 March 2008, Tata Motors reached an agreement with Ford to purchase their Jaguar Land Rover operations for US$2.3 billion. The sale was completed on 2 June 2008.
In addition to the brands, Tata Motors has also gained access to two design centres and two plants in UK. The key acquisition would be of the intellectual property rights related to the technologies.
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Joint ventures
Tata MarcoPolo released a low-floor bus in India and now it is widely used as public transport in Delhi, Mumbai, Chennai, Bangalore, Chandigarh and Lucknow. Tata Motors has formed a 51:49 joint venture in bus body building with Marcopolo of Brazil. This joint venture is to manufacture and assemble fully-built buses and coaches targeted at developing mass rapid transportation systems. The joint venture will absorb technology and expertise in chassis and aggregates from Tata Motors, and Marcopolo, will provide know how in processes and systems for bodybuilding and bus body design. Tata and Marcopolo have launched a low-floor city bus which is widely used by Chennai, Coimbatore Delhi, Mumbai, Lucknow and Bengaluru transport corporations. Its manufacturing facility is based in Dharwad. Tata Motors also formed a joint venture with Fiat and gained access to Fiat¶s diesel enginetechnology.Tata Motors sells Fiat cars in India through a 50/50 joint venture Fiat Automobiles India Limited, and is looking to extend its relationship with Fiat and Iveco to other segments. Tata has also formed several JV's with many small companies in various countries around the world.
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Important developments Tata Nano Main article: Tata Nano
Tata Nano In January 2008, Tata Motors launched Tata Nano, the least expensive production car in the world at about 120,000 (US $3000). The city car was unveiled during the Auto Expo 2008 exhibition in Pragati Maidan, New Delhi. Tata has faced controversy over developing the Nano as some environmentalists are concerned that the launch of such a low priced car could lead to mass motorization in India with adverse effects on pollution and global warming. Tata has set up a factory in Sanand, Gujarat and the first Nanos are to roll out summer 2009. Tata Nano Europa has been developed for sale in developed economies and is to hit markets in 2010 while the normal Nano should hit markets in South Africa, Kenya and countries in Asia and Africa by late 2009. A battery version is also planned.
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Main Target:-
Tata Ace Main article: Tata Ace
Tata Ace was India's first mini truck Tata Ace, India's first indigenously developed sub one ton mini-truck, was launched in May 2005. The mini truck was a huge success in India with auto analysts claiming that Ace had changed the dynamics of the light commercial vehicle (LCV) market in the country by creating a new market segment termed the small commercial vehicle (SCV) segment. Ace rapidly emerged as the first choice for transporters and single truck owners for city and rural transport. By October 2005, LCV sales of Tata Motors had grown by 36.6 percent to 28,537 units due to the rising demand for Ace. The Ace was built with a load body produced by Autoline Industries. Ace is still a top seller for TML with 5 lakh units sold to date (June 2010).
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Ace has also been exported to several Asian, European, South American and African countries and all electric models are sold through Chrysler's Global Electric Motorcars division. In Sri Lanka it is sold through Diesel & Motor Engineering(DIMO) under the name of DIMO Batta.
Compressed air car Main article: Tata OneCAT
Tata OneCAT Motor Development International of France has developed the world's first prototype of acompressed air car, named OneCAT. In 2007, MDI owner Guy Negre was reported to have "the backing of Tata". It has airtanks that can be filled in 4 hours by plugging the car into a standard electrical plug. In 2008 MDI planned to also design a gas station compressor, which would fill the tanks in 3 minutes.There are no gasoline costs and no fossil fuel emissions from the vehicle when run in town, but "the compressed air driving the pistons can be boosted by a fuel burner". OneCAT is a five seat vehicle with a 200 litre (7.1 cu ft) trunk. With full tanks it is said to run at 100 km/h (62 mph) for 90 kilometres (56 mi) range in urban cycle. There are severe physical arguments pleading against those figures. In December 2009 Tata's vice president of engineering systems confirmed that the limited range and low engine temperatures were causing difficulties.
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Electric vehicles Tata Motors unveiled the electric versions of passenger car Tata Indica and commercial vehicle Tata Ace. Both run on lithium batteries. The company has indicated that the electric Indica would be launched locally in India in about 2010, without disclosing the price. The vehicle would be launched in Norway in 2009.
Four CNG - Electric Hybrid low floored Star buses to be used for Commonwealth games. These are the first Environmentally friendly buses to be used for public transportation in India.
Operations
The Tata Safari DiCOR is one of Tata's best selling vehicles in India and also has been fairly successful in the Mediterranean and Eastern Europe
Tata has tried to revamp all its models in order to satisfy the consumer
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The purchase of Jaguar and Land Rover is expected to help give Tata Motors gain a foothold in the European and American markets.
Tata relies on its subsidiaries for sales outside India. Seen here is the Range Rover Sport.
Tata Xenon is Tata's best selling vehicle in Europe.
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Tata in India
A loaded Tata truck on a Rajasthanhighway Tata Motors Limited is India¶s largest automobile company, with revenues of 35,651.48 crore (US$7.91 billion) in 2007-08.[29]It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles in India with products in the compact, midsize car and utility vehicle segments.Tata vehicles are sold primarily in India, and over 4 million Tata vehicles have been produced domestically since the first Tata vehicle was assembled in 1954. The company¶s manufacturing base in India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, Tata set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains. The company is establishing a new plant at Sanand (Gujarat). Tata's dealership, sales, service and spare parts network comprises over 3500 touch points. Tata Motors also distributes and markets Fiat branded cars in India. Sales & Service Network Tata Motors has more than 250 dealerships in more than 195 cities across 27 states and 4Union Territories of India It has the 3rd largest Sales and Service Network after Maruti Suzuki and Hyundai. Tata's global operations Tata Motors has been in the process of acquiring foreign brands to increase its global presence. Through acquisition, Tata has operations in the UK, South Korea, Thailand and Spain. Among these acquisitions is Jaguar Land Rover, a business comprising two struggling iconic British brands that was acquired from the Ford Motor Company in 2008. In 2004, Tata acquired the Daewoo Commercial Vehicles Company, South Korea¶s second largest truck maker. The rebranded Tata Daewoo Commercial Vehicles Company has launched several new products in the Korean market, while also exporting these products to several international markets. Today two thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. In 2005, Tata Motors acquired a 21% controlling stake in Hispano Carrocera, a Spanish bus and coach manufacturer. Tata Motors continued its market area expansion through the introduction of new products such as buses (Starbus & Globus, jointly developed with subsidiary Hispano Carrocera) and trucks (Novus, jointly developed with subsidiary Tata Daewoo). In May, 2009 Tata unveiled the Tata World Truck range jointly
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developed with Tata Daewoo Debuting in South Korea, South Africa, the SAARC countries and the MiddleEast. Tata formed a joint venture with the Brazilbased Marcopolo to manufacture fully built buses and coaches for India and other international markets. Tata Motors has expanded its production and assembly operations to several other countries including South Korea, Thailand, South Africa and Argentina and is planning to set up plants in Turkey, Indonesia and Eastern Europe. Tata also has franchisee/joint venture assembly operations in Kenya, Bangladesh, Ukraine, Russia and Senegal.Tata has dealerships in 26 countries across 4 continents Though Tata is present in many countries it has only managed to create a large consumer base in the Indian Subcontinent, namely India, Bangladesh, Bhutan, Sri Lanka and Nepal. Tata has a growing consumer base in Italy, Spain and South Africa.
Products Passenger cars and utility vehicles
Tata Prima concept car
Tata Nano Europa
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Tata Starbus Low Floor 1610
Tata Marcopolo buses in the Delhi BRT.
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Tata Aria Products:
Tata Sierra (Discontinued) Tata Estate (Discontinued) Tata Sumo/Spacio Tata Sumo Grande Tata Safari Tata Indica Tata Vista Tata Indigo Tata Manza Tata Indigo Marina Tata Winger Tata Magic Tata Nano Tata Xenon XT Tata Aria Tata Venture Tata Iris
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Concept vehicles
2000 Aria Roadster 2001 Aria Coupe 2002 Tata Indiva 2004 Tata Indigo Advent 2005 Tata Xover 2006 Tata Cliffrider 2007 Tata Elegante 2009 Tata Pr1ma 2010 Tata Versa 2010 Tata Essota 2011 Tata Pixel
Commercial vehicles
Tata Ace Tata TL/Telcoline/207 DI Pickup Truck Tata 407 Ex and Ex2 Tata 709 Ex Tata 809 Ex and Ex2 Tata 909 Ex and Ex2 Tata 1109 (Intermediate truck) Tata 1512 (Medium bus chassis) Tata 1612/1616 (Heavy bus chassis) Tata 1618 (Semi Low Floor bus chassis)
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Tata 1623 (Rear Engined Low Floor bus chassis) Tata 1613/1615 (Medium truck) Tata 2515/2516 (Medium truck) Tata Starbus (Branded Buses for city, inter city, school bus and standard passenger transportation) Tata Divo (Fully built luxury coach) Tata CityRide (12 - 20 seater buses for intra-city use) Tata 3015 (Heavy truck) Tata 3118 (Heavy truck) (8×2) Tata 3516 (Heavy truck) Tata 4018 (Heavy truck) Tata 4923 (Ultra-Heavy truck) (6×4) Tata Novus (Heavy truck designed by Tata Daewoo) Tata Prima (The World Truck designed by Tata Motors and Tata Daewoo)
Military vehicles
Tata LSV (Light Specialist Vehicle) Tata Mine Protected Vehicle (4×4) Tata 2 Stretcher Ambulance Tata 407 Troop Carrier, available in hard top, soft top, 4×4, and 4×2 versions Tata LPTA 713 TC (4×4) Tata LPT 709 E Tata SD 1015 TC (4×4) Tata LPTA 1615 TC (4×4) Tata LPTA 1621 TC (6×6)
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MILESTONES ACHIEVED
1945: Tata Engineering and Locomotive Company Limited was established to manufacture locomotives and other engineering products. 1948: Stem road roller introduced in collaboration with Marshall sons (UK). 1954: Collaboration with Daimler Benz AG, W.Germany, for manufacture of medium commercial vehicles. The first vehicle rolled out with in 6 months of the contract. 1959: Research and Development Center set up at Jamshedpur. 1961: Exports began with the first truck being shipped to Ceylon, Now Srilanka. 1966: Setting up of the engineering research center at pune to provide impacts to automobile research and development. 1971: Introduction of DI engines. 1977: First commercial vehicle manufactured in Pune. 1983: Manufacture of heavy commercial vehicle commences. 1985: First hydraulics excavator produced with Hitachi collaboration. 1986: Production of first light commercial vehicle, Tata 407, indigenously designed followed by Tata 608.
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1991: Launch of the first indigenous passenger car of Tata Siera. One million vehicles rolled out. 1992: Launch of Tata estate. 1993: Joint venture agreement signed with Cummins Engine Co. inc. Power and emission friendly diesel engines. 1994: Launch of Tata Sumo. The multi utility vehicle. Joint venture agreement signed with M/s. Daimler Benz / Mercedes Benz for manufacture of Mercedes Benz passenger cars in India. Joint venture agreement signed with Tata Holset Ltd., U.K. for manufacturing turbo chargers to be used on Cummins engines. 1995: Mercedes Benz Car E 220 launched. 1997: Tata Sierra Turbo launched 10000,000th Tata sumo rolled out. 1998: Tata Safari ± India¶s first sports utility vehicle launched. 2 million vehicles rolled out. Indica, India¶s first fully indigenous passenger car launched. 1999: 115,000 bookings for Indica registered against full payment within a Week. Commercial production of Indica commences in full swing. 2000: First consignment of 160 Indicas shipped to Malta. Indica with Bharat stage 2 (Euro II) complaint diesel engine launched. Launch of CNG buses. 2001: Indica V2 launched 2nd generation indica Indica V2 becomes Indian¶s number one car in its segment.
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2002: Unveiling of the Tata Sedan at Auto Expo 2002. 5,00,000th passenger vehicle rolled out. Tata Engineering signed a product agreement with M G Rover of the UK. 2003: The Tata indigo station wagon unveiled at the Geneva motors show. On 29th July J.R.D Tata¶s birth anniversary, Tata Engineering¶s becomes Tata Motors Limited. 2004: Tata Motors and Daewoo Commercial Vehicle Co. Ltd. sign investment Agreement. Tata Motors completes acquisition of Daewoo Commercial Vehicle Company. Tata Daewoo Commercial Vehicle Co. Ltd. (TDCV) launches the heavy duty truck 'NOVUS' , in Korea. Tata Motors lists on the NYSE. 2005:
Tata Motors rolls out the 500,000th Passenger Car from its Car Plant Facility in Pune Branded buses and coaches - Starbus and Globus - launched Tata Motors acquires 21% stake in Hispano Carrocera SA, Spanish bus manufacturing Company Tata Motors wins JRD QV award for business excellence. Inauguration of new factory at Jamshedpur for Novus Tata TL 4X4, India's first Sports Utility Truck (SUT) is launched Launch of Tata Novus Launch of Novus range of medium trucks in Korea, by Tata Daewoo Commercial Vehicle Co. (TDCV)
2006: Tata Motors and Marcopolo, Brazil, announce joint venture to manufacture fully built buses & coaches for India & markets abroad. Tata Motors first plant for small car to come up in West Bengal. Tata Motors extends CNG options on its hatchback and estate range. TDCV develops South Korea's first LNG-Powered Tractor- Trailer. Tata Motors and Fiat Group announce three additional cooperation. Agreements. 2007: Construction of Small Car plant at Singur, West Bengal, begins on January 21. Tata Motors and Thonburi Automotive Assembly Plant Co. (Thonburi),announce formation of a joint venture company in Thailand to manufacture,assemble and market pickup trucks. Tata-Fiat plant at Ranjangaon inaugurated. Fiat Group and Tata Motors announce establishment of Joint Venture in India.
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2008: 2009: 2010:
Ace plant at Pantnagar (Uttarakhand) begins production. Indica Vista ± the new generation Indica, is launched. Tata Motors' new plant for Nano to come up in Gujarat. Tata Motors unveils its People's Car, Nano, at the ninth Auto Expo. Xenon, 1-tonne pick-up truck, launched in Thailand. Tata Motors signs definitive agreement with Ford Motor Company to purchase Jaguar and Land Rover. Tata Motors completes acquisition of Jaguar Land Rover. Tata Motors is Official Vehicle Provider to Youth Baton Relay for TheIII Commonwealth Youth Games Pune 2008.
Tata Marcopolo Motors, Dharwad plant beings production Tata Motors launches Nano - The People's Car Launch of premium luxury vehicles - Jaguar XF, XFR and XKR and Land Rover Discovery 3, Range Rover Sport and Range Rover from Jaguar and Land Rover in India Tata Nano wins the Indian Car of the Year (ICOTY) Award Tata Motors acquires remaining 79% in Hispano Carrocera.
Appointment of Mr. Carl-Peter Forster as Managing Director of Tata Motors. Tata Motors to construct heavy truck plant in Myanmar under Government of India¶s Line of Credit. Tata Motors declared as the Commercial Vehicle Maker of the Year. Tata Motors Passenger Car Division launches µTata Motors Service Edge¶ for leading edge customer service. Chief Minister of Punjab inaugurates Tata Motors supported State Institute of Automotive and Driving Skills. Tata Motors appoints Mr. Carl-Peter Forster as Group CEO.
Tata Motors Group displays the widest range of products and environment friendly technologies at Auto Export 2010.
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Facts And Figures
FINANCIAL PERFORMANCE SUMMARY OPERATING RESULTS AND PROFITS After the economic downturn and difficult market conditions in the automotive sector globally in 2008-09, during the year, economies across the world (with a few exceptions) showed signs of recovery and growth. The Indian economy bounced back quickly and strongly growing at 7.2% in 2009-10. The automotive sector in India started the year steadily, gathered momentum in different segments in the second half of the year and ended the year with a record growth and performance. The Company¶s turnover, in this background and with a strong portfolio coupled with successful launch of new products and variants in commercial vehicles and passenger vehicles, was Rs.38,364 crores, a growth of 34.3% over the previous year. The volume growth coupled with other actions on pricing and cost reduction enabled the Company to achieve significant improvement in EBIDTA margin to 11.7% (6.8% in 2008-09). The Profit Before Tax of Rs.2,830 crores and Profit After Tax of Rs.2,240 crores also grew significantly over the previous year by 179.1% and 123.7% respectively. The Tata Motors¶ Group turnover was Rs.95,567 crores, a growth of 29% over previous year contributed mainly by market recovery, improved realization and successful launch of new products. Consolidated Profit Before Tax was Rs.3,523 crores (Loss of Rs.2,129 crores in 2008-09) and Consolidated Profit for the year was Rs.2,571 crores (Loss of Rs.2,505 crores in 2008-09).
VEHICLE SALES AND MARKET SHARES The Company recorded a sale of 633,862 vehicles in 2009-10, a growth of 34% over previous year (472,885 vehicles) in the domestic market in India, representing a 25.5% share in the industry (improving from 24.4% share in the previous year). Commercial vehicle sales were highest ever at 373,842 vehicles achieving a robust growth of 40.9% over previous year and a market share of 64.2% (a gain of 0.4%, over previous year). A strong product portfolio, successful launch of new products and variants, extensive efforts in marketing and finance enablement for customers and leadership in market research and penetration, contributed to the significant improvement in overall performance. Some of the key highlights were:- In M&HCV, growth of 36.5% to 155,161 vehicles and a market share improvement to 63.3% (from 61.9% in the previous year); launch of the next generation of heavy trucks - Prima range; completion of delivery of 1,625 low entry buses to Delhi Transport Corporation and delivery of major portion of the orders of over 5,000 buses under JnNURM Scheme of Government of India for modernizing the public transport in India. - The Light Commercial Vehicle (LCV) sales recorded a spectacular growth of 45.4% in FY 2009-10. While this was largely aided by the growth in the small commercial vehicles, the rest of the segment also grew handsomely. The competition in the small commercial vehicle range increased resulting in a 0.5% loss in the domestic market share reducing it to 64.8%. The Company¶s sales increased by 44.2% to 218,681 LCVs. The Company launched new variants on the Ace platform, Ace EX, Super Ace and the 407 Pickup which are expected to help in gaining volumes.
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Passenger vehicle sales were 260,020 vehicles, highest ever, achieving a growth of 25.3% over previous year and a market share of 13.7% (stable compared to 13.6% in the previous year). The Company continues to be amongst the top three players in the passenger vehicle market which has over 25 players. The growing sales of the new generation Indica Vista and successful launch and market response for the Indigo Manza mainly contributed to the growth. Some of the key highlights were: - In the Small Car segment, increase in market share to 13.3% (as against 12.7%, in the previous year), with the growing sales of Indica Vista, sales of the Nano and the Fiat Punto; - Commencement of sales of Nano in July 2009 and completing deliveries of 30,763 cars to the customers and commencement of trial production in the Sanand plant. - The Indigo range sales of 54,551 units, a growth of 10.9% over the previous year and also the highest ever sales by the Company in this range, mainly due to the launch of the Indigo Manza in October 2009. - Sale of 33,507 Multi-Utility Vehicles (MUVs), a decline of 14.7% against the last year and as a result the market share dropped to 12.4%. The Grande Mk II which was launched in December 2009 has been well accepted in the market and is expected to help in regaining market share in the UV segment. Sale of 24,884 Fiat cars which has given Fiat a 1.3% market share as against 0.5% in the previous year with Linea sales at 11,102 nos. (a segment share of 10.1%) and the Grande Punto sales at 13,281 (a segment share of 3.5%). - The Company sold 225 Jaguar and Land Rover vehicles through its exclusive dealerships in India in the first year of the sales of the Jaguar Land Rover brands. The Company¶s international business remained affected by the economic downturn in many of the key markets. The Company¶s commercial vehicle exports grew moderately by 4.7% to 27,878 vehicles and passenger vehicles exports declined by 9.9% to 6,231 vehicles. With improved economic outlook and market recovery and with the new product range, the Company expects significant improvement in its international business in the future. Tata Motors¶ Group sales were 880,396 vehicles across its entire range of products and markets. The key highlights were: - The Company has sold 667,971 vehicles. - Jaguar Land Rover achieved sale of 193,982 vehicles as compared to 167,348 vehicles in 2008-09 (in 10 months since Tata Motors acquisition of the business in June 2008). Jaguar Land Rover continued to enhance its product offerings through an all new XFR, powertrain offerings and 2010 model year vehicles. The new Jaguar XJ was unveiled in London in July 2009 and had its public debut at the Frankfurt Motor Show in September 2009. - In South Korea, Tata Daewoo Commercial Vehicle Company Limited (TDCV) successfully launched the new premium truck platform ± Prima; TDCV sales were stagnant at 9,011 vehicles in Korea and international markets as compared to 9,137 vehicles in the previous year. - In Thailand, Tata Motors (Thailand) Limited saw a very good response to the CNG version of the Tata Pickup vehicle ± Xenon.
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PESTEL ANALYSIS
Political: Since Tata Motors operates in multiple countries across Europe, Africa, Asia, the Middle East, and Australia, it needs to pay close attention to the political climate but also laws and regulations in all the countries it operates in while also paying attention to regional governing bodies. Laws governing commerce, trade, growth, and investment are dependent on the local government as well as how successful local markets and economies will be due to regional, national and local influence. In accordance, Tata¶s headquarters in Mumbai, India, strictly controls and regulates operations in all dealerships and subsidiaries, in addition to knowing and abiding by all labor laws in the multiple countries where they have manufacturing plants it has to watch political change. Economic: Operating in numerous countries across the world, Tata Motors functions with a global economic perspective while focusing on each individual market. Because Tata Motors is in a rapid growth period, expanding or forming a joint venture in over five countries world-wide since 2004, a global approach enables Tata Motors to adapt and learn from the many different regions within the whole automotive industry. They have experience and resources from five continents across the globe, thus when any variable changes in the market they can gather information and resources from all over the world to address any issues. For instance, if the price of the aluminium required to make engine blocks goes up in Kenya, Tata has the option to get the aluminium from other suppliers in Europe or Asia who they would normally get from for production in Ukraine or Russia. Tata Motors also has to pay close attention to shifts in currency rates throughout the world. Currency fluctuations can equate to higher or lower demands for Tata vehicles which in turn affect profitability. It can also mean a rise in costs or a drop in returns. But they also have to pay attention to not just the domestic currency, the rupee, but also to the dollar, euro, bhat, won, and pound, to just name a few. Just because the rupee is strong against the dollar does not mean it is strong against all the other currencies. Attention to currency is important because it influences where capital investment will develop and prosper. Social : Undoubtedly, the beliefs, opinions, and general attitude of all the stakeholders in a company will affect how well a company performs. This includes every stakeholder from the CEO and President, down to the line workers who screw the door panel into place, from the investor to the customer, the culture and attitude of all these people will ultimately determine the future of a company and whether they will be profitable or not. For this reason, Tata Motors tends to use an integration and rarely separation technique with foreign companies they acquire. In 2004, Tata Motors acquired Daewoo Commercial Vehicles Company, which was at the time Korea¶s second largest truck maker. Rather than using de-culturation or assimilating Daewoo, Tata took an integrated approach, and continued building and marketing Daewoo¶s current models as well as introducing a few new models globally just as it had been done under Korean management.
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Technology: Tata Motors and its parent company, the Tata Group, are ahead of the game in the technology field.³The foundation of the company¶s growth is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customer-desired offerings through leading edge R&D´ (Tata). Employing 1,400 scientists and engineers, Tata Motors¶ Research and Development team is ahead of the pack in India¶s market and right with the rest of the field internationally. Among Tata¶s firsts are ³the first indigenously developed Light Commercial Vehicle, India's first Sports Utility Vehicle and, in 1998, the Tata Indica, India's first fully indigenous passenger car,´ as well as the increasingly famous Tata Nano, which is projected to be the world¶s cheapest production car (Tata). In the automotive industry, it is becoming increasingly crucial for manufacturers to stay on top of the technology curve with new problems always rising such as escalating gas prices and pollution problems. Tata recognizes this and dedicates lots of resources and time into research and development to be even with or preferably ahead of other competitors, global trends, and changing economies. In all, an automobile manufacturer must change, adapt, and evolve to stay competitive in the automotive game, and this is exactly what Tata is doing with their rapid growth, and extensive research and development. Environmental: Environmental factors include the weather and climate change. Changes in temperature can impact on many industries including farming, tourism and insurance. With major climate changes occurring due to global warming and with greater environmental awareness this external factor is becoming a significant issue for firms to consider. Tata Motors has been making conscious effort in the implementation of several environmentally sensitive technologies in manufacturing processes. The Company uses some of the world's most advanced equipment for emission check and control. Tata Motors concern is manifested by a dual approach 1) Reduction of environmental pollution and regular pollution control drives 2) Restoration of ecological balance. Tata Motors is committed to restoring and preserving environmental balance, by reducing waste and pollutants, conserving resources and recycling materials. Reducing Pollution: Tata Motors has been at the forefront of the Indian automobile industry's anti-pollution efforts by introducing cleaner engines. It is the first Indian Company to introduce vehicles with Euro norms well ahead of the mandated dates. Tata Motors' joint venture with Cummins Engine Company, USA, in 1992, was a pioneering effort to introduce emission control technology for India. Over the years, Tata Motors has also made investments in setting up of an advanced emission-testing laboratory.
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With the intention of protecting the environment, Tata Motors has upgraded the performance of its entire range of four and six cylinder engines to meet international emission standards. This has been accomplished with the help of world-renowned engine consultants like Ricardo and AVL. These engines are used in Tata Motors vehicles in the Indian market, as well as in over 70 export markets. Tata Motors is constantly working towards developing alternative fuel engine technologies. It has manufactured CNG version of buses and followed it up with a CNG version of its passenger car, the Indica. Restoring Ecological Balance: Tata Motors has set up effluent treatment facilities in its plants, to avoid release of polluted water into the ecosystem. In Pune, the treated water is conserved in lakes attracting various species of birds from around the world thus turning the space into a green belt. Tree plantation programmes involving villagers and Tata Motors employees, have turned acres of barren village green. Tata Motors has planted as many as 80,000 trees in the works and the township and more than 2.4 million trees have been planted in Jamshedpur region. Over half a million trees have been planted in the Poona region. Tata Motors has directed all its suppliers to package their products in alternate material instead of wood. End of Life Vehicle Treatment and Recycling: India is a recycling society with many people making value out the recovery of waste materials discarded from products at the end of their useful life. However, Europe, and some other export markets, have recognised that they have become a 'throwaway' society in recent decades, and are now introducing waste prevention regimes in different industry sectors to collect and recycle valuable resource rather than it ending up in landfill. In the Automotive sector, the European End of Life Vehicle (ELV) Directive, points responsibility for this issue to vehicle manufacturers, and the scrap car recovery industry. Similar regulations are being introduced in Japan and Korea. Naturally, Tata Motors has already met the 'producer responsibility' aspects of the ELV Directive, such as compliance to Heavy metals and other hazardous substance restrictions. Also, material code marking of plastic parts has been introduced to aid achievement of demanding European recycling targets. Legal: The constitution of India and the laws enacted there under, enshrine Human Rights as fundamental rights. These are duly reflected with adequate provision for their protection in the various labour laws in the country. The Tata Code of Conduct sets out guidelines on compliance with all regulatory requirements and also on specific issues, which in sum is the articulation of Tata Motors policy on Human Rights. The Tata Code of Conduct also clearly states that wherever, the laws are more lenient than the Code, the Code shall prevail. Locational Ethics counsellors have been appointed to deal with any concerns raised pertaining to clauses mentioned in the Tata Code of Conduct. A monitoring system is in place to ensure compliance with the Code. Corrective actions are taken at process and/or system levels as appropriate. Tata Motors Limited has Supplier and Dealer assessment process to take care of issues related to social aspects before inducting them in organisation. All legal and regulatory requirements need to be fulfilled before final selection into the Tata Motors fold. The company periodically audits the job contractors for adherence to labour laws and other statutory requirement like minimum wages, PF, payment of gratuity etc. thereby ensuring prevention of violation of Human rights and employment malpractice. Tata Motors has a special contracts cell and price panel, which conducts regular compliance audits of contractors and suppliers to ensure their adherence to legal enactment, thereby ensuring
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prevention of violation of Human rights and employment malpractice. In keeping with the spirit of the Constitution of India wherein Right of Association is a Fundamental Right, Tata Motors respects the right for association of its employees and has constructive relationship with trade unions at all locations. Employees are encouraged to join the Trade Unions, as it believes that most individual and collective grievances can be resolved through bipartite forums. This has led to good industrial relations. With its collaborative approach to company union, Tata Motors has not faced legal action regarding anti-union practices. Approximately 15000 of Tata Motor¶s permanent employees, who come under the unionised category, are covered by collective bargaining agreements. These agreements include health and safety provisions along with compensation structures in the form of a Memorandum of Understanding (MoU) between the management and the representing Union as per the provisions of the applicable labour legislations. These MoUs are signed every three years after negotiations between representing committees of the union and the Management. While the union membership may vary from each location, all eligible employees, irrespective of his membership, enjoy the benefits as agreed in the MoU. While the existing grievance handling process takes care of issues of temporary employees, the recognised Unions also take up their issues. Tata Motors strictly adheres to the laws of the land with regard to forced and compulsory labour. The statutory regulations like Contract Labour Act, the Factories Act and the tripartite/ bi-partite settlement between the management and the union every three years serve as a legal binding force. The disciplinary action process at Tata Motors is as per the applicable laws like Model Standing Orders / Certified Standing Orders that allow the process of natural justice as per statute. Tata Motors upholds the Tata tradition of not employing children in any of its Companies. It is bound by the statutory legislation (Factories Act, 1948) and proper records are maintained in this regard. The Certified Standing Orders of the Company expressly state that the age of an employee at the time of recruitment should be 18 years or more. TCOC clause on equal opportunities is the basis to prevent all forms of discrimination. In addition, Tata Motors has formalised policy statements on Human Rights, Sexual Harassment, Equal Opportunities, and Corporate Social Responsibility.
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Core Competency:
Tata Motors is able to maintain, as well as increase, their market shareby capitalizing on their core competencies. Tata Motors is active, competitive, and dynamic in all aspects of the automotive industry, which means that there must be many different activities going on inall areas of the company. As a result of the ever evolving automotive industry Tata Motors must always be changing and one way to stay at the forefront of the industry is to make continuous improvements in technology through research and development. One way that TataMotors has done this is by producing one of the most efficient and low cost vehicles on the market. Acquisitions, mergers, and expansion is another core competency that Tata Motors has is embedded in their company structure and philosophy. Another core competency that TataMotors holds is being located in the India. This location has allowed them to understand not only the Indian market but also the dynamics of emerging and developing markets.This market understanding and knowledge allows Tata Motors to manufacture their products at lower costs, sell them to emerging markets while making profits as well as take advantage of the strong labor base in India.
Sharing of Skills/Core Competence
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SWOT Analysis:
Strengths
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y
y
y y y y y y y
The internationalisation strategy so far has been to keep local managers in new acquisitions, and to only transplant a couple of senior managers from India into the new market. The benefit is that Tata has been able to exchange expertise. For example after the Daewoo acquisition the Indian company leaned work discipline and how to get the final product 'right first time.' The company has a strategy in place for the next stage of its expansion. Not only is it focusing upon new products and acquisitions, but it also has a programme of intensive management development in place in order to establish its leaders for tomorrow. The company has had a successful alliance with Italian mass producer Fiat since 2006. This has enhanced the product portfolio for Tata and Fiat in terms of production and knowledge exchange. For example, the Fiat Palio Style was launched by Tata in 2007, and the companies have an agreement to build a pick-up targeted at Central and South America. Excellent brand equity and image in Indian market. Sound global recognition in light trucks and buses. Sound fundamentals in turbo diesel because of their joint venture with Cummins Good Presence in Indian Markets Ownership of heritage of British motor brands like land Rover and Jaguar. Strategic tie up with Benz .They follow premium segment marketing World class quality accreditation(ISO 9001; ISO 20000)
Weaknesses
y y
y
y y y y y y
The company's passenger car products are based upon 3rd and 4th generation platforms, which put Tata Motors Limited at a disadvantage with competing car manufacturers. Despite buying the Jaguar and Land Rover brands (see opportunities below); Tat has not got a foothold in the luxury car segment in its domestic, Indian market. Is the brand associated with commercial vehicles and low-cost passenger cars to the extent that it has isolated itself from lucrative segments in a more aspiring India? One weakness which is often not recognised is that in English the word 'tat' means rubbish. Would the brand sensitive British consumer ever buy into such a brand? Maybe not, but they would buy into Fiat, Jaguar and Land Rover (see opportunities and strengths). Never done well in UK; USA and European Markets. Not yet prepared fundamentally to handle global markets of Land Rover and Jaguar. Weak technical competencies. Perceived as Indianized. Do not possess localization skills outside Indian Markets. Focus in more on cost thus car lacks advanced features.
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Opportunities
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y y
y
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y y
In the summer of 2008 Tata Motor's announced that it had successfully purchased the Land Rover and Jaguar brands from Ford Motors for UK £2.3 million. Two of the World's luxury car brand have been added to its portfolio of brands, and will undoubtedly off the company the chance to market vehicles in the luxury segments. Tata Motors Limited acquired Daewoo Motor's Commercial vehicle business in 2004 for around USD $16 million. Nano is the cheapest car in the World - retailing at little more than a motorbike. Whilst the World is getting ready for greener alternatives to gas-guzzlers, is the Nano the answer in terms of concept or brand? Incidentally, the new Land Rover and Jaguar models will cost up to 85 times more than a standard Nano! The new global track platform is about to be launched from its Korean (previously Daewoo) plant. Again, at a time when the World is looking for environmentally friendly transport alternatives, is now the right time to move into this segment? The answer to this question (and the one above) is that new and emerging industrial nations such as India, South Korea and China will have a thirst for low-cost passenger and commercial vehicles. These are the opportunities. However the company has put in place a very proactive Corporate Social Responsibility (CSR) committee to address potential strategies that will make is operations more sustainable. The range of Super Milo fuel efficient buses are powered by super-efficient, eco-friendly engines. The bus has optional organic clutch with booster assist and better air intakes that will reduce fuel consumption by up to 10%. Introduce Asian variants of jaguar and Land Rover by promoting µ¶ Power Icon¶¶ Brand which will work well with Asian politicians. Develop more joint ventures like Tata Mercedes ± Benz.
Threats
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y
Other competing car manufacturers have been in the passenger car business for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in terms of quality and lean production. Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalises and buys into other brands this problem could be alleviated. Since the company has focused upon the commercial and small vehicle segments, it has left itself open to competition from overseas companies for the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and Toyota. In fact the entire Indian market has become a target for other global competitors including Maruti Udyog, General Motors, Ford and others.
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y
y y y y y
Rising prices in the global economy could pose a threat to Tata Motors Limited on a couple of fronts. The price of steel and aluminium is increasing putting pressure on the costs of production. Many of Tata's products run on Diesel fuel which is becoming expensive globally and within its traditional home market. Many companies across the world are busy developing their own models of Economy cars they may launch in competition with Tata motors Must catch in terms of Quality and lean production. Since company has focussed upon commercial and small vehicle segment it has left open to competition from overseas. Rising prices in global economy. Price of steel and aluminium is increasing putting pressure on costs of production.
Diesel fuel is becoming expensive globally.
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Future Plans
Major Future Plans 1. Capitalize on Tata Nano - Fast Delivery. 2. Launch New Commercial Vehicles. 3. Tie up with more State Govts. for Efficient & Safe City Buses at low cost. 4. Launch of Jaguar & Land rover Vehicles in India. 5. Bridge the outstanding loans. 6. Focus on Cost Reduction. 7. Expand Network. Future Challenges: ? ? ? ? Tata Motors relies heavily on its sales in India. Tata Motors now faces stiff competition from fellow compatriots like Mahindra, Maruti as well as multinational brands like Toyota and Chevrolet. It has faced controversy over developing the µNano¶ Ashok Leyland, Tata's biggest competitor in the Indian heavy commercial vehicle market .
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Suggestion And Conclusion
Suggestion: ? ? ? ? ? Should increase no of service centers. Should bring more variants. Easy availability of spare parts. Should increase no of outlets. Should employ skilled labour.
Conclusion: In a small segment consumer seeks for: ? ? ? ? Good mileage. Low maintenance. Easy availability of spare parts. Easy finance Price.
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References:
http://www.tata.com http://tatamotors.com http://www.wikipedia.com www.quickmba.com/strategy/porter.shtml www.presentationmagazine.com/rule-of-three-836.htm
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doc_623644816.docx