“Project report on Strategies used by TATA

motors for it’s Domestic and Global

Expansion”

Group 1:
Abhishek Mathur (01)

Abhinav Gupta (02)

Aditi Mehrotra (03)

Agni Chatterjee (04)

Akash Chauhan (05)

1
 Executive Summary
TATA Motors previously known as TELCO was started way back in 1945
primarily as a manufacturer of Heavy and Medium Commercial Vehicles. It
entered the passenger car segment in 1998 with the production of first
indigenous car of India INDICA. The company has been expanding rapidly
both geographically as well as in the terms of offering new products to the
customers. The company started as a traditional auto maker has now
resorted to adoption of blue ocean strategy with the production of TATA
Nano. One can also see that the company in the past 5 years has
diversified its kitty to a large extent. The automotive giant is seen
manufacturing the people’s car NANO and Jaguar Land Rover. It has also
formed a JV with the Brazilian Bus Manufacturing Giant MARCOPOLO.

Although the company had posted profits in the past 5 years, the year
2008-09 was not one which TATAS would like to remember. The J-LR deal
had been a setback for the company. But with the support of TATA Sons
the parent company it will be sail through this also and emerge as a
winner.

However, the bottom line is that TATA Motors is an Indian Company which
has managed to create a niche in the global market for itself.

2
Index

S. No TOPIC Page No

1. Indian Automobile Industry 4

2. TATA Motors Limited 6

3. SWOT Analysis 8

4. Expansion in the Domestic Market 9

5. Expansion Abroad 11

6. Reasons to Move Ahead 13

7. Four Grandiose Strategy-International Expansion 15

8. Future Strategies for Global Expansion 17

9. Resources 19

10 Value Chain 23

11 New Product Introduction 26

12. Strategy Analysis 27

13. Conclusion 30

3
 Indian Automobile Industry
The seeds of the Indian automobile industry were laid during 1940s. After
independence, in 1953, the Government of India and the private sector
launched efforts to create an automotive component manufacturing
industry to supply to the automobile industry. However, the growth was
relatively slow in the 1950s and 1960s due to nationalization and the
license raj which hampered the Indian private sector. After 1970, the
automotive industry started to grow, but the growth was mainly driven by
tractors, commercial vehicles and scooters. Cars were still a major luxury.

In the 1980s, a number of Japanese manufacturers launched joint-

ventures for building motorcycles and light commercial-vehicles. It was at
this time that the Indian government formed a collaboration with Suzuki
under the name Maruti Suzuki to manufacture small cars. Following the
economic liberalization in 1991 and the gradual weakening of the license
raj, a number of Indian and multi-national car companies launched
operations.

At present it holds a promising tenth position in the entire world with

being number 2 in two wheelers and number 4 in commercial vehicles.

Automobile industry of India can be broadly classified under passenger

vehicles, commercial vehicles, three wheelers and two wheelers, with two
wheelers having a maximum market share of more than 75%. Automobile
companies of India, Korea, Europe and Japan have a significant hold on
the Indian market share. Tata Motors produces maximum numbers of mid
and large size commercial vehicles, holding more that 60% of the market
share. Motorcycles tops the charts of two wheelers with Hero Honda being
the key player. Bajaj by far is the number one manufacturer of three
wheelers in India.

Passenger vehicle section is majorly ruled by the car manufacturers

capturing over 82% of the total market share. Maruti since long has been

4
the biggest car manufacturer and holds more that 50% of the entire
market.

Global recession has impacted, the Indian automobile industry also and
can be seen clearly in the sales figures of the last financial year. Even
then this industry has high hopes in 2009-2010, as banks have reduced
loan interest rates and the major chuck of automobile customers belong to
the middle income group who are becoming economically stronger with
every passing day.

5
Tata Motors Limited – A brief History
Tata Motors is a part of the Tata Group and its share-holding is managed
through Tata Sons. The company was established in 1945 as a locomotive
manufacturing unit and later expanded its operations to commercial
vehicle sector in 1954 after forming a joint venture with Daimler-Benz AG
of Germany. Despite the success of its commercial vehicles, Tata realized
his company had to diversify and he began to look at other products.
Based on consumer demand, he decided that building a small car would
be the most practical new venture. So in 1998 it launched Tata Indica,
India's first fully indigenous passenger car. Designed to be inexpensive
and simple to build and maintain, the Indica became an instant hit in the
Indian market. It was also exported to Europe namely the UK and Italy.
Since then it has never looked back. In 2004 it acquired Tata Daewoo
Commercial Vehicle and in late 2005 it acquired 21% Aragonese Hispano
Carrocera giving it controlling rights of the company. It has formed a Joint
Venture with Marcopolo of Brazil and introduced low-floor buses in the
Indian Market. Recently TATA Motors limited has been in news because of
acquiring Jaguar Land Rover and for manufacturing the cheapest car in
the world TATA Nano.

Following are some key events from Tata Motors' history:

1945 - Tata Engineering and Locomotive Co Ltd (TELCO) set up as a

locomotive maker at the end of World War Two

1954 - Company shifts to making trucks in a joint venture with Germany's

Daimler Benz

1977 - Commences production of commercial vehicles

1994 - Enters venture with Daimler to make Mercedes Benz cars in India

1998 - Launches fully indigenous passenger car, the Indica

2001 - Ends joint venture with Daimler

6
2002 - TELCO renamed Tata Motors Ltd

2003 - Announces plan to build world's cheapest car, to sell for 100,000
rupees

2004 - Acquires South Korea's Daewoo Commercial Vehicle Co, and lists
on the New York Stock Exchange. Launches Indigo sedan

2005 - Buys 21 percent stake in Spanish bus maker Hispano Carrocera SA,
launches mini-truck Ace in India

2006 - Signs manufacturing and distribution agreement with Fiat, enters

venture with Brazilian bus maker Marcopolo

2008 - Unveils the Nano at Delhi Auto Expo

- Buys Jaguar and Land Rover from Ford Motor Co for $2.3 billion

7
SWOT ANALYSIS

Strengths

• Strong presence in the commercial vehicle market

• Brand recognition
• High investment in R&D
• Wide distribution channels

Weaknesses

• Limited product portfolio in the passenger segment

• Operations mainly restricted to India

Opportunities

• Increasing demand for cars in India

• Expansion in international markets

Threats

• Increase in prices of raw materials

• Intense competition from global players

Expansion in the Domestic Market

8
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 station wagon design based on the earlier 'Tata
Mobile' (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. After this
there was no looking back. Indica was followed by many other models
both in LCV and MHCV namely Indigo, Indigo Mariana, Xenon, Ace and
many more.

The expansion in Indian Markets has also been on account of two major
joint ventures:

A. Marcopolo Brazil

Tata Motors has formed 51:49 joint venture with the bus body
manufacturer, Marcopolo of Brazil. This joint venture is to
manufacture and assemble fully-built buses and coaches targeted at

9
 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 buses in Mumbai, Delhi etc.

B. Fiat India

Tata Motors also formed a joint venture with Fiat and gained access
to Fiat’s diesel engine technology. Tata Motors sells Fiat cars in India
and is looking to extend its relationship with Fiat and Iveco to other
segments. Fiat's first body-on frame pickup will have the same
styling as TATA Xenon and is to be named Fiat Terra. This
acquisition has also helped in stream lining the production and
sharing the load of the CAR Plant.

10
Expansion Abroad
Tata Motors has been aggressively acquiring foreign brands to increase its
global presence. Tata Motors has operations in the UK, South Korea,
Thailand and Spain. Among them is Jaguar Land Rover, a business
comprising the two iconic British brands that was acquired in 2008. Tata
Motors has also acquired from Ford the rights to three other brand names:
Daimler, Lanchester and Rover. In 2004, it acquired the Daewoo
Commercial Vehicles Company, South Korea’s second largest truck maker.
The rechristened 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% stake in Hispano Carrocera, a reputed
Spanish bus and coach manufacturer, giving it controlling rights of the
company. Hispano’s presence is being expanded in other markets. On
Tata's journey to make an international foot print, it continued its
expansion through the introduction of new products into the market range
of buses (Starbus & Globus) as well as trucks (Novus). These models were
jointly developed with its subsidiaries Tata Daewoo and Hispano
Carrocera. In May, 2009 Tata unveiled the Tata World Truck range jointly
developed with Tata Daewoo They will debut in South Korea, South Africa,
the SAARC countries and the Middle-East by the end of 2009. In 2006, it
formed a joint venture with the Brazil-based Marcopolo, a global leader in
body-building for buses and coaches to manufacture fully-built buses and
coaches for India and select 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 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 worlwide.
11
 W. Asia Africa Australia
S. E. Asia 9% 7% 1%
10%

S. Asia
22% Europe
Latin America 44%
7%

Percentage wise distribution of business abroad

World wide Presence

12
TATA Motors and its reason to move Abroad

Recent years have seen a number of foreign automobile enterprises

coming to India, attracted by a growing economy and an expanding
market. The reverse — Indian auto companies seeking new frontiers
abroad — is a trickle, but Tata Motors is working hard to change the
equation.

Tata Motors has come a long way since the 1950s and 1960s, when it
needed technical assistance from Daimler Benz and had just commercial
vehicles to power sales. Today the company is the country's largest
automobile manufacturer and has a passenger vehicle business that has
broken new ground in exemplary fashion. But domestic patronage, hefty
as it may be, is ultimately limiting, particularly with increasing
competition. Which is why, the exploration of foreign markets is an
imperative for ambitious automobile companies such as Tata Motors.

Besides competition, the automotive business, particularly the commercial

vehicle market, is characterised by its considerably strong link to national
economies. Companies looking to do more than just stay afloat cannot
afford to keep their business connected solely to the fortunes of one
country.

Another reason that Tata Motors is looking outwards is cost advantage.

Until now Indian companies, manufacturers in particular, have been
protected by high duty structures and a generally depreciating rupee. But
sometime in the near future, if import restrictions are relaxed or the rupee
begins to gain ground, India may not continue to have the low-cost
manufacturing advantage it has enjoyed thus far. In that scenario, a
presence in countries that offer greater cost advantages for
manufacturing will pay off.

A third argument for overseas expansion is the fact that the automotive
business relies so much on economies of scale, which translate into price

13
benefits. Tagging along is the competitiveness factor, where quality and
efficiency are directly improved (or should be) as a result of the high level
of competition in foreign markets.

One of the important strategies that TATA motors have adopted is to

widen its foreign campaign to more than just exports.

In 2002, recognising the need to integrate its international strategy with

its domestic one, the company split its previously independent
international business arm into commercial and passenger segments and,
as part of its overall business strategy, merged them with its commercial
and passenger vehicle business units.

14
Four grandiose strategy adopted by TATA
for International Expansion:

As part of its plans, the company has plotted four routes to international
expansion.

The first is the traditional method of export, at which the company has
been quite successful, notching up export revenue of Rs 969 crore in the
first nine months of FY 2004-05, recording a growth of 41 per cent from
sales in Europe, Africa, the Middle East and Asia.

The second is setting up assembly operations abroad. This does not

necessarily involve establishing a full-scale manufacturing unit, but an
operation where kits are sent in semi knocked down or completely
knocked down assemblies, or as a fully assembled vehicles and sold in
that market. Tata Motors worked this into its strategy when it set up its
first assembly operation in Malaysia in 1974. Since then the company has
similarly expanded into Malaysia, Bangladesh, Senegal, South Africa and
Ukraine. All these assembly operations are set up by the distributors of
Tata Motors for these countries.

The third scenario would be actual acquisition, the route Tata Motors
took with Daewoo South Korea. Here, Tata Motors bought the full-fledged
heavy vehicle-manufacturing unit and, in the process, gained not just a
manufacturing asset base, but access to the market through an already
strong brand identity. The company was also presented a wide choice in
terms of the markets in which it could use the Daewoo brand and, more
importantly, access to R&D capability in the area of commercial vehicles.

In the short period of six years since the launch of passenger cars, Tata
Motors has already achieved the No 2 position in the domestic car market
in India. The company has successfully launched Indica in South Africa and
Turkey and is marketing it under its own brand name.
15
One of the greatest strengths of TATA motors is that it knows its market.
For example, the compact-sized Indica is marketed in countries where the
company perceives a substantial market for it, like it did in Europe.

Tata Motors' immediate goal is to achieve a 35-per cent contribution to its

overall revenue from its international businesses by 2010. This seems to
be realistic enough following the Daewoo acquisition, and its own products
getting into more than 70 countries. Looking at successful global auto
majors, for whom anywhere from 30 to 50 per cent of their business
accrues from overseas sales, Tata Motors is still a long way off, but
management believes that with its aggressive growth strategy a
contribution of around 45 per cent may be achievable in five-six years.
The trickle factor will by then begin to gather force.

16
Future Strategies for Global Expansion:

TATA Motors have been instrumental in a new direction to the

globalisation of the Indian auto industry. The wave of liberalisation has
given Indian corporates a new dimension to ‘globalisation’. Tata Motors, a
trendsetter in the Indian automobile industry, is setting a new direction to
the globalisation of the Indian auto industry.

The question that has been in the minds of the senior management at
Tata Motors was — will they remain exporters of vehicles or do they
venture into the international automobile market as a company that can
match the best in the business? The answers were obvious.

The first step was to align the international business to the two business
units — the Passenger Car Business Unit (PCBU) and the Commercial
Vehicle Business Unit (CVBU), to bring greater focus and increased
synergy between the domestic and international operations.

International business needs to be looked at from a perspective that goes

beyond volumes and presence in many countries. The company has now
embarked on a road where it have made exports an integral part of their
business. TATA do not think of sales outside the country as a separate
activity. It is now integrated within the mission of each of its businesses.

The Business Units have classified different markets in terms of size,

growth opportunities, product segments and target volumes. Therefore,
from being present as an exporter in 70 countries, the company today
focuses on 15 to 20 key countries, where it will have a significant
presence in terms of volumes and market shares.

The implementation of the business strategy will be in three stages;

product upgradation, sales and distribution processes and penetration into
new markets. The three stages could run concurrently, depending on the
market and product needs.
17
Tata Motors has taken a number of initiatives to strengthen both product
reliability and durability and marketing processes. Enhancing distribution
reach and a robust sales process system have been key elements in
consolidating the company’s leadership position in the domestic market.
The implementation of this strategy has begun in a few markets abroad
and in Mr Kant’s words "What we needed was an integrated approach
where we invest in all the critical elements — product upgradation, sales
processes, distribution and above all, people."

The company’s approach has been successful in Sri Lanka and Malaysia
where the installation of a sales process system and face-to-face customer
meets through road shows and service workshops has started yielding
results. Recently, a large contingent of dealers from South Africa was
invited to visit the company’s facilities in Pune and experience the new
face of the international business.

The second part of the business strategy is to make an entry in new and
yet uncharted markets, such as China and the CIS countries. Besides the
assembly plants that Tata Motors has in Bangladesh and Malaysia, the
company’s recent order for 500 buses from Senegal will involve providing
technical and commercial assistance to the Senegalese government for
setting up a bus body building plant. Tata Motors has been short-listed for
South Africa’s "Taxi Project" in which the government will provide an
entirely new transport system in that country. A joint venture project for
bus body building in Ukraine and serious due diligence into the
opportunities available in the Chinese market are other areas where Tata
Motors is looking to create new opportunities.

On the road to globalisation, the Rover agreement has been an important

step in helping Tata Motors to gain very quick access to a fairly large
market and a large distribution network. Dr.Sumantran, executive
director, PCBU feels that it would take more than three years to show
positive results that they expect from rover agreement.

18
Innovation, knowledge, commitment and pride have been Tata Motors’
greatest asset and it takes right mix of people with the right skills to make
this happen.

Resources

Technological Resources:

• R & D establishments called ERC in Jamshedpur, Lucknow and Pune.

These facilities employ more than 1400 engineers.
• TATA Motors has a certified crash test facility and hemi anechoic
chamber for testing of noise and vibration.
• TMETC (TATA Motors European Technical Centre) set up in 2005-
primarily involved in design engineering and development of
products. It also acts as a support system for TATA Motors skill sets.
• TATA Daewoo, the JV between TATA Motors and Daewoo Group, has
its R & D facility in Gunsan, South Korea.
• The JV with Spanish Hispano Carrocera has a R & D facility at
Zaragoza Spain.

19
Operational Resource:

Operational Resources have two main models. The first model is TATA
Business Excellence Model which derives its roots from the Malcolm
Baltridge Model. This model applies across the various Business Units of
the TATA Group

The model has been given below:

The second model which TATA Motors follows is the Enterprise Process
Model. The model has been described below:

20
Both the models work in congruence with each other to create synergy
between the business unit, the group and the various stakeholders.

Besides the above two models, the other operational resources employed
by TATA Motors are:

• Sound leadership- Ratan TATA, Sumant Moolgaonkar

• Ethical business Practices- TATA Code of Conduct (TCOC)
• Successful Integration of various JVs and strategic alliances
• Reputation of the Brand TATA worldwide

21
Financial Resources:

Before the fiscal year 2008-09, the financial flows to the company had
been stable and it was showing a huge profit margin. However, with the
slump and the acquiring of Jaguar- Land Rover, there has been a little
setback in the financial side but still with the support of the parent brand
TATA Sons it will be able to sail through the current financial crunch.

Besides this it has easy access to capital markets due to the reputation of
the Brand TATA. It also has a tie up with TATA Financial Services which
has been supporting the ambitions of the company with easy cash flow.

22
Value Chain

The value chain of the TATA Motors has been given as below:

Value C
The various primary activities of the value chain have been discussed
below:

1. Inbound Logistics: The main features of inbound logistics have

been discussed below:

 Tata Motors believes in establishing long term contract

with service providers – transporters and agents.
 Talented Personnel have been deployed at regional offices
for over seeing the smooth transit of goods.

23
  The company aims at maintaining transparency and
monitoring through deployment of IT – all transactions
through SAP.
 DTL supplies for critical high value items.
 Efficient storage facilities – easy storage and retrieval

2. Operations: For the smooth functioning of operations TATA Motors

has the following features:

 Capital Equipment Manufacturing division – TATA Motors

prides itself in having tooling development capabilities of
global standard.
 Apprentice Trainee Course – This helps the organization in
ensuring stable source of skilled manpower.
 Kaizen & TPM team – the two teams strive for continuous
methods to improve efficiencies.
 Automated manufacturing processes.
 Distributed manufacturing – Assembly units at South Africa,
Thailand, Bangladesh, Brazil etc.
 Maintenance – technical competence.
 Capacity Utilization – Mercedes Benz cars make use of Tata
Motors paint shop facilities.

3. Outbound Logistics: the following methods form a part of

outbound logistics:

 Stockyards, all across the country to stock inventory

 Long term contracts with transporters– higher volume of
business to transporters ensures competitive price.
 Regional Sales Office and Vehicle Dispatch Section linked
through SAP.
 Efficient security system for prevention of any kind of
pilferage.
24
4. Marketing & sales: The important features of marketing and sales
are:

 Structured approach to understanding the requirements of

individual customers – QFD’s conducted at regular intervals.
 Clear identification of product requirements, leading to
development of innovative products – Tata 207 DI, Tata Ace
 Pan India presence and global footprint.
 Independent teams for addressing the requirements of
institutional customers – Defense, State Transport Units
 Helping to augment the scarce resources – Fiat selling
vehicles through Tata dealerships, in return Tata has access to
Fiat’s technology and unutilized capacity.
 Quick assessment of the changing market dynamics and
consumer preferences – Tata 407 LCV
 Large network of dealers – use of technology: DMS.

5. Service: TATA Motors provides the following after sales services:

 Easy availability of spare parts throughout the country

 Efficient collection of data from field and communication to

the respective plants.
 Pan India presence, as well as global presence.
 Large network of workshops – Dealer workshops and sales
workshops
 Training facilities – for dealer end and sales personnel

25
New product Introduction

Innovation is the key to sustainability. TATA Motors believes firmly in this

statement. The following chart explains the process of develop new
products.
Tata Motors Vehicle NPI Process – Conceptual Overview
Product Product DesignValidation
Concept Concept Pre- Ramp-up
Phases

Strategy & Design and &

Evaluation Development development Productionisation Production Phase
Planning
Phase Phase Phase Phase
Phase Phase
•Market •Concept •Performance & •Design analysis •Full design •Quality Proving •Ramp-up
analysis alternatives Weight analysis &simulation validation &Process •PL Build
Activities
(Indicative)

•Competitor •QFD •Style &Spec’ •Alpha proto •Beta proto tests validation
assessment •Styling themes dev’mt. &Freeze tests •Production tooling •P0 &PP Builds
•Explore Prod. •Packaging •Vehicle & •Aggregate tests •Vendor parts dev. •Vendor parts
Options •Manf. Feasibility Aggregate plans •Crash tests •Install &comm. approval
•Product •Cost targeting •Product costing •Manf. Planning Facilities •Homologation
planning •Financial analys •Detail costing

PIPI DD
R0 DD
R1 DD
R2 DD
R3 DD
R4 DD
R5 LL
Gateways

R0 R1 R2 R3 R4 R5
Initiation
Project

Launch
Prod
Produu
ct
ct Con
Con ce
cepp
tt Conce
Conceppttaa
nn
dd DDeesig nn
sig Prod
Produuction
ct ion Project
Project
Stra
St te
ra gg
teyy Selele
Se ction
ction Proje
Projectct Re
Relele
aa
sese Re
Relele
aa
sese Revie
Re ww
vie
Re view
Review Ap
Appp
rova
rovall
DR1 Sign-offs DR2 Sign-offs DR3 Sign-offs DR4 Sign-offs DR5 Sign-offs
•9BOX & •Product Profile & •Product spec & •Design release •Critical issues •Launch volumes
Deliverables
Gateway

supporting tech targets Features list •Long lead tooling brochure •QP build
(Partial)

docs •Recommended •Vehicle Test Plan signed off •Vehicle test completion
style theme •Style &packaging •Component requirements met •Vendor parts
•Prelim. Cost / wt sign off reliability plan •Control plans fully approved
targets •Time &res. plan •Biz. Case signoff •Ramp up plan
•Prelim. Biz case •Full Biz. case validation

This methodology makes it easy for TATA Motors to reduce the time for
new product to reach the market.

Strategy Analysis
26
• Mergers and Acquisitions with key companies that enhanced
its foothold in global as well as local market: M&A has been
one of its key strategies for expansion. Its acquisition of Daewoo
Commercial Vehicle helped it earn a plant in Korea which improve
domestic market share, exports and top line profits.

Tata buyout of JLR helped the company acquire a global footprint

and enter the high-end premier segment of the global automobile
market.

TATA – Fiat dealers network agreement.

• Huge investment in developing strong R&D: World-class

automotive research and development are key factors that
contribute to the leadership of the Company. Research centre at
Jamshedpur and The Engineering Research Centre in Pune are the
finest in the country and it regularly upgrades it components and
aggregates.

With 1400 engineers and scientists, the TATA Motors Engineering

Research Centre has enabled pioneering technologies and products.
Every vehicle is developed in close conjunction with customer
needs, virtually simulated, prototyped and then operated in real
time on the most arduous terrain.

Today, the R&D network of TATA Motors is truly international. This

covers R&D centres in India located at Pune, Jamshedpur and
Lucknow, besides centres in South Korea, Spain and UK.

• Product Innovation: With so much investment in R&D, product

innovation has to be the output. “TATA Nano” – The cheapest car in
the world costing $2500 is the best example of product innovation.
Other than this, Tata Motors has the unique distinction of giving
India its first and only indigenously built passenger car - the Tata
Indica and the premium feature sedan - the Tata Indigo.

27
 “ACE” – The mini truck is also a very good example of innovation.
They are the small trucks with more roads capable to accommodate
them.

“Tata Safari” 4X4 Dicor is one more highly acclaimed innovations by

TATAs. It has “Reverse Guide System”. A weather-proof camera is
fixed to the rear car to help the driver while reversing the car.

• Focus on key Subsidiaries: TATA motors have strong focus on its

subsidiaries. Tata Motors has 30 subsidiaries in India and abroad,
out of which 21 are profit making. These subsidiaries contributed to
Rs.6453.67 crore revenue out of the total consolidated revenue of
Rs.37,000 crore.

Key subsidiaries of Tata Motors are Tata Construction, Tata Daewoo

Commercial Vehicle (TDCV) and Telco Construction Equipment
Company (TELCON), a 60:40 JV between Tata Motors and Hitachi.

TDCV is the largest subsidiary in sales terms while TELCOM is the

highest profit making subsidiary, as such these two may be first one
to get listed.

Tata hived its automotive technology and R&D division into Tata
Technologies which services engineering and design requirement of
automobile and aerospace industry.

• Expanding presence in overseas market

• Focus on Bus market: TATA motors has expanded its product

range offering for Russian market. Companies focus is now to
explore the possibility of entering various segments of medium and
heavy trucks and buses over the next three years. TATA motor’s
Trucks and Buses are being marketed in several countries in Europe,
Africa, the Middle East, South Asia, South East Asia and South
America.

28
 TATA motors believe that focusing on small vehicles wont hit the
margins, hence focusing on Bus and Truck segment is imperative.

• Plan to streamline production

• Joint ventures to upgrade technology

• Great Marketing Strategies:

- The internationalization 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.

Nano- A blue ocean strategy

- Creation of an unconsolidated market space

- No competition
- Capturing new demand
- Breaking the value cost trade off

29
- Differentiation and low cost

30
Conclusion
Buying of premium vehicle brands such as Land Rover and Jaguar has
bolstered Tata Motors’ image as a global company and increased its
global reach and scale. Overall, the Tata group has spent around $15.5
billion in acquiring foreign companies The Tata name is a unique asset
representing leadership with trust. TATA Motors is trying to leverage this
asset to enhance group synergy and has been successful. The synergy has
developed as a result of the strengths of domestic and foreign market
share, congregating under the umbrella of Tata group.The Tata Group as a
whole has over 20 publicly listed enterprises and operates in more than 80
countries world-wide - lots of experience and resources to draw from for
research and development purposes. Strong corporate governance based
on “rich legacy of fair, ethical, and transparent governance practices” has
helped to ensure that its employees act ethically and the business
continues to run smoothly.

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