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TATA MOTORS :

QUEST FOR BECOMING


A GLOBAL CONTENDER

Group No
Name
Viraj Bhosale
Sushant
Cowlagi
Ashesh Joshi
Sye Nihalani

12.

Roll No
07
12
21
34

INDIAN AUTOMOTIVE
INDUSTRY

The automobile sector of India is the seventh largest in the


world.

It manufactures over 11 million vehicles and exports about


1.5 million each year.

It attained a turnover of USD $35.8 million.

Contributes about 4 per cent in India's GDP.

India overtook China by emerging as the fourth largest


exporter of cars in Asia.

Has provided direct and indirect employment to 13.1


million people.

AUTOMOTIVE COMPANIES IN
INDIA

TATA MOTORS- Brief


Introduction
Formerly

known as TELCO-Tata Engineering And Locomotive Company renamed Tata Motors

in 2003.
Entered

commercial vehicle sector in 1954 on joint venture with Daimler-Benz.

Founded
Tata

by JRD Tata and currently handled by Ratan Tata headquartered in Mumbai.

manufactures HCV,LCV,Passenger Cars, MUV and military vehicles.

India's

largest automobile company, Leader in commercial vehicles in each segment and


among top three in passenger vehicles.

The

company is world's 17th-largest motor vehicle manufacturing company,4th largest truck


manufacturer, and the world's second largest bus manufacturer.

Tata

Motors ranked 314th in 2012 Fortune Global 500 ranking of the world's biggest
corporations.

Revenue

- 2,32,834 crores (2013-2014)

Employee

Count-5,81,473 (2013-2014)

TATA MOTORS Product Profile

Passenger &
Utility Vehicles

Concept
Vehicles

Commercial
Vehicles

Military
Vehicles

-Tata
-Tata
-Tata
-Tata
-Tata
-Tata
-Tata

-Tata Pixel
-Tata Air Car
Mini
Cat
-Tata Prima
2009
-Tata Cliffrider
2006
-Tata Xover
2005
-Tata Indigo
Advent 2004

-Tata
-Tata
-Tata
-Tata
-Tata
-Tata
-Tata
-Tata

-Tata LSV
-Tata Bantam
-Tata Mobile
Bunker
-Tata Safari
Armoured
-Tata Sumo
Armoured
-Tata 4x4 Mine
Protected

Indica
Vista
Nano
Manza
Indigo
Indigo CS
Indigo XL

Ace
World Truck
Daewoo
Hispano
Magic Iris
Globus
Winger
Starbus

EXTERNAL ENVIRONMENT : A
PESTEL STUDY
Political : operating in multiple countries across Europe, Africa, Asia,
the Middle East, and Australia, it needs to pay close attention to the
political climate. Tatas headquarters in Mumbai, India, strictly
controls and regulates operations and abiding on all labour laws in all
the countries where they have plants in operations.
Economic : A global approach enables Tata Motors to adapt and learn
from the many different regions.They have experience and resources
from five continents across the globe, thus when any variable
changes in the market they can be gathered from other.
Social : TML is involved in supports for around 600 NGOs. Tata Motors
tends to use an integration and rarely separation technique with
foreign companies they acquire.
Technology :Employing 1,400 scientists and engineers, Tata Motors
Research and Development team is ahead of the pack in Indias
market and right with the rest of the field internationally. Formation of
Tata Technologies Limited.

INDUSTRY ANALYSIS :
PORTERS FIVE FORCES
Industry Rivals Facing competition from domestic and foreign
automotive Manufacturers. Improving infrastructure has made foreign
companies enter India market via merger with existing Indian ones or
starting direct operations, this brings regular innovation and up
gradation.
Bargaining Power of buyers The bargaining power of buyers is higher
in Consumer Vehicle segment than in Passenger Vehicle ones.
Bargaining power of Suppliers Tata motors have a good grip over the
suppliers, however in capital intense industry, Switching cost of supplier
is high.
Threats of Substitutes Two and three wheelers are direct substitute
products while public transportation is an indirect one
Threats of New entrants High investment and barriers for new comers
but easy of existing ones to enter into new markets

GROWTH STRATEGY : ANSOFF


MATRIX
Market Penetration : Tata Motors used this strategy when they
reached UK market by take over Jaguar-Land Rover to increase profits
and develop goodwill due to good reputation of Brands
Product Development : Introduction of Tata Nano in the existing
market of India & tata star bus and tata Xover
Market Development : Tata Motors has developed their market
overseas; they reached South Korea market in 2004, Spain market in
2005, Thailand market in 2006, UK market in 2008 and many more.
Tata Motors sells their existing products like buses, trucks, and cars in
those markets.
Diversification : Tata Motors diversified their products when they
entered UK market and took over Jaguar-Land Rover in 2008. It
allowed Tata Motors to produced new products line, for example,
Jaguar X-Type and Land Rover LRX.

SWOT ANALYSIS :
STRENGTHS
International
Strategy
Acquisitions
Brand Name
R&D
Financials
Product Portfolio

OPPURTUNITIES
JVs New Markets
Scope of
innovations
Expanding Market

WEAKNESS
Luxury Segment
Strong in the Indian
Sub continent only
Advertising
Relatively Old
Product
Platforms

THREATS

Rise in Costs
Competition
Need for
Innovations
Stress on
Environment

BCG ANALYSIS

Indica Vista, Starbus,


Ace, Manza, Winger,
Magic, Tata Prima,
Other LCEs.

Jaguar, Land Rover,

Safari, Sumo, Indigo


CS, Indigo XL.

Tata Nano, Versa, &


Other new
innovations.

Sierra, Estate.

VRIO FRAMEWORK :

Customer Understanding / Brand /


R&D

Supplier base / Market Know how

V
R
I
O

SUSTAINABL
E
COMPETITIV
E
ADVANTAGE
TEMPORARY
COMPETITIV
E
ADVANTAGE

COMPETITIV
Organizational Culture / Human E
ADVANTAGE
Resource / Strategic Alliances

The TATA legacy Policies and


Codes to exploit the VRI
variables

BRIEF OF THE CASE

Tata Motors

Passenger Car Segment


Commercial Car Segment

Financial Crisis of 1998


3 Recovery phases

Stem the
bleeding

Consolidatin
g the
Domestic
Position

International
Diversificati
on

Launch of the Nano / Integrating the


Jaguar / Land Rover
International Strategy

TATA
INTERNATIONAL STRATEGIES

Economies

of Scale.

Standardized

Products

Uniform

service to global
customers.

Global

sourcing of raw
materials, energy, and
labor.

12

countries as priority
markets

Strategic

Alliances /
Acquisitions

MOTORS
SEEKING TO
ADOPT

QUESTION 1 - Evaluate companies


commercial vehicles (Trucks/Buses)
strategy from 2003 to 2007

In 2004 Acquired Daewoo commercial vehicles.


By Identifying about 12 countries as priority markets,
rather than 60 to 70 countries try to tap previously.
Acquired Nissans plant in south Africa as a assembly
plants to serve the African countries.
In 2005 Acquired a 21% stake in Spanish Bus & coach
manufacturer. Which help to learn Spanish expertise
in Luxury buses targeting Europe, US, Africa & Latin
America.
In 2006 formed JV with Brazil based Marcopolo, global
leader in body-building for buses & coaches.
In 2006 formed JV with Thonburi auto for
manufacturing Pick-up trucks.
Tata Motors has over 130 models of light, Medium &

QUESTION 2 - Evaluate the companies


passenger car and multi utility vehicle
strategies from 1991 to 2007

Compact car Tata Indica launched in 1998. Utility


Vehicle Tata Sumo Launched in 1994 & tata safari
launched in 1998 & then revamped in 2005.
Focus more on Commercial vehicles & passenger
cars.
Introduced the Sadan Indigo in 2002 & then station
Wagon, Indigo marina in 2004.
Joint venture with Fiat in 2006 at
Ranjangaon( Maharashtra).
Mini Truck segment in 2005 with Tata Ace & it
famous in short span of time, in June 2007 launched
passenger variant named as Magic & first maxivan
The Tata Winger.
Greenfield Venture. Tata selected as one of the 7
global campanies approved by Thai government.
Environment Friendly vehicles- Collaboration with
Norwain Firm.

QUESTION 3 A - What is the


standing of TATA motors in the
global automobile industry

Ranked 19th worldwide

In 2007, worlds 2nd largest


Medium and Heavy Bus
Manufacturer ( Source: Case )

In 2007, worlds 5th largest


Medium and Heavy Commercial
Vehicle Manufacturer.

Presence in over 120 countries

M / A / JV with Daewoo (Korea ),


Hispano Carrocera ( Spain ),
Marcopolo ( Brazil ), Thonburi
( Thailand ) etc.

QUESTION 3 A - What is the


standing of TATA motors in the
global automobile industry

QUESTION 3 B - Does being an


Indian company offer any
competitive advantage

Origins in 1868
TATA brand Trust
Knowhow of the Indian Market Nano Case
Supplier / R&D base / Manufacturing plants
Threat of New Entry
Resources Strategic Alliances
/ facilities / HR / Brand
Capabilities Market Sensing
Competitive Advantag
/ Learning Curve / Experience
/ Range / R&D

QUESTION 4 - Were the two big bets of


2008
(Nano launch & acquisition of land
rover) Justified?

Story of the Nano


Plant transfer
Necessity ( West ) v/s Luxury ( India )
Cost factor
Issues after the launch
Re-branding Awesome / Smart Car

Total cost $ 2.3 billion


Access to premium segment
Extension of its multi utility all terrain
vehicles
Access to Knowhow / Export Markets
A step towards a Global company

Justified
but
Positioning
went wrong

In line with
the Vision /
Mission

QUESTION 5 - What execution


challenges will the company face in
contending to be global company
Competition in India
Launch of the Nano
Integration of the Jaguar / Land Rover
Understanding Markets abroad
Innovating continuously
Competing Globally
Economic scenario
Rising Costs

LEARNINGS AND CONCLUSION


Opportunity Analysis
Segmentation strategies
Strategic Partnerships ( M&A/JV )
Globalization importance
Importance of leaders

Through effective implementation of the


Integration Generic Strategy >>> TATA MOTORS
( 1 of the crowned jewels of the TATA group ) is
well on its way in becoming a Global
Contender

THANK

YOU