Tata Mergers


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Tata Mergers

  1. 1. International Marketing Mergers & Acquisitions
  2. 2. Tata Motors • India's largest automobile company, with consolidated revenues of INR 1,65,654 CR (USD 32.5 billion) in 2011-12. • Leader in Commercial vehicles and among the top three in Passenger vehicles • It is the world's fourth largest truck and bus manufacturer. • Employee Strength of Tata Motors Group: Over 55,000 employees • Vision: To be ''best in the manner in which we operate, best in the products we deliver, and best in our value system and ethics.''
  3. 3. • Established in 1945, Tata Motors' presence indeed cuts across the length and breadth of India. • Over 7.5 million Tata vehicles ply on Indian roads, since the first rolled out in 1954. • Manufacturing base in India – Jamshedpur (Jharkhand) – Pune (Maharashtra) – Lucknow (Uttar Pradesh) – Pantnagar (Uttarakhand) – Sanand (Gujarat) – Dharwad (Karnataka) Tata Motors
  4. 4. • January 2008: – Tata Motors unveiled its People's Car, the Tata Nano – The Tata Nano has been subsequently launched, as planned, in India in March 2009. • May 2009: – Tata Motors unveiled its new range of world standard trucks called Prima • October 2010: – Tata Motors launched the Tata Aria, the first Indian four-wheel drive crossover • Tata Motors is equally focused on environment-friendly technologies in emissions and alternative fuels. It has developed electric and hybrid vehicles both for personal and public transportation. • It has also been implementing several environment-friendly technologies in manufacturing processes, significantly enhancing resource conservation. Tata Motors: Innovation
  5. 5. • Year 2012 – Tata Motors signs cooperation agreement with DRB-HICOM's Defence Technologies (DEFTECH) – Tata Motors showcases Anti-Terrorist Indoor Combat Vehicle concept at DEFEXPO India 2012 – Tata Motors unveils Tata Safari Storme, Tata Ultra, Tata LPT 3723 new vehicles at Auto Expo 2012 Tata Motors: Innovation
  6. 6. • Tata Motors, the first company from India's engineering sector to be listed in the New York Stock Exchange (September 2004), has also emerged as an international automobile company. Tata Motors: Overview Year | Company Name Details More info 2004 | Daewoo Commercial Vehicles Acquisitions of South Korea's second largest truck maker Today two-thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. 2005 | Fiat Strategic alliance It has set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains 2005 | Hispano Carrocera Acquired a 21% stake in Hispano Carrocera, a reputed Spanish bus and coach manufacturer, and subsequently the remaining stake in 2009 Hispano's presence is being expanded in other markets. 2006 | Marcopolo Joint venture with the Brazil- based company (a global leader in body-building for buses and coaches) Joint venture was formed to manufacture fully- built buses and coaches for India and select international markets
  7. 7. • Tata Motors is also expanding its international footprint, established through exports since 1961. • The company's commercial and passenger vehicles are already being marketed in several countries in Europe, Africa, the Middle East, South East Asia, South Asia, CIS, Russia and South America. • It has franchisee/joint venture assembly operations in Bangladesh, Ukraine, and Senegal. Tata Motors: Overview Year | Company Name Details More info 2006 | Thonburi Joint venture with Thonburi Automotive Assembly Plant Company of Thailand Joint venture formed to manufacture and market the company's pickup vehicles in Thailand. 2008 | Tata Africa Holding (Pty) Ltd Joint venture Joint venture formed for its assembly plant in South Africa . The plant can assemble, from semi knocked down (SKD) kits, light, medium and heavy commercial vehicles ranging from 4 - 50 tonnes
  8. 8. Tata Motors: Marketing Mix
  9. 9. • Tata has a very wide range of products it has passenger cars, utility vehicles, Trucks, Commercial passenger Carriers And Defence Vehicles Marketing Mix: Product Passenger cars Utility Vehicles Trucks Commercial Passenger Carriers Indica vista Safari Dicor Tata Novas Buses Indigo XL Sumo Grande TL 4×4 Winger Nano Aria Magic Fiat cars Xenon XT
  10. 10. Marketing Mix: Product • Packaging : – A vehicle cannot have a material packaging. – Here, packaging refers to and effective assembly of features. – Tata Motors provide many innovative features to suit the target customers and the product. E.g. Tata Safari Dicor/ Aria has ‘Reverse Guide System’ which includes a weather-proof camera to help the driver while reversing the vehicle. • Innovations : – The various motives behind buying an automobile are Need, Prestige, Comfort, Fashion, Jealousy and Novelty. – The R & D department continuously strives to bring new innovations in their product. – Tata have an industrial experience of over 100 years and they are well known with the Psychology of Indian customers, who desire more at less price. – This experience has helped them to develop products which fulfill the expectations of Indian consumers. • Quality Control: – Tata Motors have their Quality Control standards and the QC Dept. ensures that the customer does not face any inconveniences of a defective product.
  11. 11. • Pricing Strategy: The prices are fixed keeping in mind a number of factors. – Prices have to be at par with the prices of the competitors. – Tata Motors give a relative price advantage as compares to its competitors. – The various determinants of price are • Market Condition • Costs incurred • Profit percentage desired by the Co. • Dealer Profit • Alterations : – The Company does not allow any alterations to any of the features of the product. – If there is an alteration which affects the performance of the engine, then the warranty becomes void. However, there may be alterations in the accessories, if desired by the customer. • Discounts : – Discounts are decided by the Co. every month. – Any further discounts made from the profits of the dealer. – However, the Co. may compensate the dealer for the discounts allowed to a certain extent. Marketing Mix: Price
  12. 12. • Channels of Distribution: – Tata Motors have dealership method of distribution of its products. – The dealers purchase products from the Co. at a negotiated price. – The MRP is fixed by the Co. and the dealer gets a profit within these prices. As the Co. deals in commercial and passenger vehicles, there may be a single or distinct dealerships to market its commercial and passenger vehicles in a town. – However, if there is a single dealership appointed, then the commercial and passenger vehicles are managed under Commercial Vehicles Dept. and Passenger Vehicles Dept. respectively. – Tata Motors have contracts with the Government of India and it supplies buses and passenger vehicles, in some cases, to the Govt. – Sometimes, bulk quantities of vehicles are ordered by a Govt. Dept. or a private company. – The sales, distribution and billing of these are looked after by the Co. itself. Marketing Mix: Place (Channels of Distribution, Physical Distribution)
  13. 13. • Physical Distribution: – The commercial vehicles are manufactured at Jamshedpur, Lucknow and Pantnagar – whereas the passenger vehicles are manufactured at Pune plant. – From the plant, the finished product is transported to the dealerships. – The nation-wide dealership, sales, services and spare parts network comprises over 2,000 touch points. – The dealerships are strategically located in the target and potential markets to ensure efficient and timely availability of its products in the market. Marketing Mix: Place (Channels of Distribution, Physical Distribution)
  14. 14. • Personal Selling : – There is minimal personal selling involved. – The Sales Officers at the dealerships collect prospective customer databases and perform cold calling to attract customers. • Advertising : – Tata Motors is responsible for the advertising of its products. – The dealer does play any role in the advertising. – The various media used for advertising are T.V., Newspapers, Magazines, Hoardings, Internet etc. – The dealer conducts point-of-purchase displays to advertise the products. – The advertisements done by the Co. help the dealer to capitalize on the market. • Sales Promotion : – The purpose of sales promotion is to supplement and coordinate advertising and personal selling; – Sales promotions are designed to persuade consumers to purchase immediately by providing special incentives such as cash rebates, prizes, extra product, or gifts. – The Co. conducts intensive sales promotion during festivals such as festive discounts during Diwali. Marketing Mix: Promotion
  15. 15. • Public Relations: – The Co. takes serious measures to maintain good public relations. – The Co. follows business ethics to ensure that the customer is satisfied and receives good service whenever and wherever he desires. Marketing Mix: Promotion
  16. 16. Marketing Mix: Promotion
  17. 17. Marketing Mix: Promotion
  18. 18. Tata Motors Jaguar & Land Rover : UK International Marketing
  19. 19. • Land Rover is a British car manufacturer with its headquarters in Gaydon, Warwickshire, United Kingdom which specializes in four-wheel- drive vehicles. • It has been owned by the Indian company Tata Motors since 2008, forming part of their Jaguar Land Rover (JLR) group. • It is the second oldest four-wheel-drive car brand in the world (after Jeep). • Jaguar Cars Ltd, known simply as Jaguar , is a British luxury and sports car manufacturer, headquartered in Whitley, Coventry, England. • It is part of the Jaguar Land Rover business, a subsidiary of the Indian company Tata Motors. Background: Jaguar & Land Rover : UK
  20. 20. • Political: – The political environment in United Kingdom is quite stable and much more organized than any other countries. – The only problem that the firm may face is the high tax rates in this country. – Which makes it more expensive as the raw material increases the cost of productions also goes up automatically and this is the reason why many firms stay out of United Kingdom. – There are also some policies by the labour contract to avoid exploitation of labour which makes this country much more expensive – The famous incident is Tata Nano project in west Bengal which had to be shifted due to the political pressure and there were riots and big problems. So this plant had to shift at different region finally it was decide to Gujarat. UK Market: PEST Analysis
  21. 21. • Today in financial crises every government is under tremendous pressure for the lack of investment and increasing unemployment. Jaguar Land Rover (JLR), Tata's UK-based car maker beset by recession and falling sales, wants the Government to act as guarantor to underwrite a £340m loan on offer from the European Investment Bank, but the Government is stalling. It also wants Labor to encourage banks to advance it loans worth £400m • “Tata Motors executives will warn Business Secretary Lord Mendelssohn that they will scrap plans to build electric cars in the UK if it does not receive a 10 million pound loan soon”. After launching the project “low carbon industrial strategy” by Lord Mendelssohn Tata showed a great deal of interest and decided to build electric cars and applied for 10 million pounds loan. The firm secured 292 million pound loan from the European Investment Bank in April, but this needs to be guaranteed by the British Government and the two sides still cannot reach agreement on the conditions, the paper reports. (ANI) UK Market: PEST Analysis
  22. 22. • Sociological: – Every International company faces socio-cultural problems, proper research to overcome this problem is necessary. – Geographically we are divided into different continents and every country has its own cultural, according to this the company’s has to adjust and make some changes to their approach. – Jaguar on other hand is planning to shut down a factory and stop the production for X-type cars. This move will cost 300 job cuts while trying to adjust with changing economy, where it reported a loss of 521.8$ million in 2008-2009. Tata motors have also announced to export Tata Nano in United Kingdom with some minor changes according to the rules and regulations of the country. UK Market: PESTEL Analysis
  23. 23. • Sociological: – Tata in general has to look at the boarder view at the socio cultural changes from its home country as in India is a developing nation the labour laws are not so perfectly followed. – There are lots of changes in cultural like Demographic, lifestyle patterns changes, attitude towards issues like education and corporate social responsibility and ethnic and religious matters. UK Market: PESTEL Analysis
  24. 24. • There also been reports of cultural clashes in Tata led Nextel in South Africa between South African Indian staff and those brought from India by Tata Communications. This was denied later on by Windily Zoë, Nextel executive head for corporate communications and branding UK Market: PESTEL Analysis
  25. 25. • Technological: – Tata has always looked positively towards technology and has invested billions of pounds for it. – Tata in UK did not face any technical problems as such but there are plenty of threats that may cause these problems. – As this is a more technically developed country the infrastructure available is much more advance and stable then India. – Tata motors European technical center (TMETC) brought up for R&D a purpose which is steadily taking Tata motors towards achieving global standards. UK Market: PESTEL Analysis
  26. 26. • The Pune factory in India for Tata motors is more emphasized on human hand rather than robotic arms, Ratan Tata believes that the labour in India is cheap and investing more on robotic arms will push more individuals on unemployment scale. • The brand new factory being set up for Tata nano in Gujarat is more technically advance to meet its demand. UK Market: PESTEL Analysis
  27. 27. • Legal obligations: – The political environment of United Kingdom is very stable and well structured. – The laws and trading policies are well developed which give minimum exploitation to laborers and customers. – Tata comes from India where the legal environment is not so stable and the regulatory bodies are incapable to enforce laws. – The British health and safety laws for the better conditions of workers are the most strong and predominant UK Market: PESTEL Analysis
  28. 28. • Legal obligations: – Buying over Land Rover and Jaguar for 2.3$ billions Tata was under tremendous pressure as there were mixed reactions from all Britain. – Plenty feared about devaluation by Indian brand and suggested government to take control of Jaguar brand, as it symbolizes best of British. – There were no real legal or political problems faced by this company in United Kingdom. – There were some MPs who did not like an Indian brand taking over British Companies. – India has the second largest investment from Asia with 75 projects in 2007-07. – The future changes to be expected in the legislation are mostly based on the environment effect and the green house effect on our earth. UK Market: PESTEL Analysis
  29. 29. • Environmental: – Today in the ever changing environment there is lot of pressure on every industry to cut down there green house gases and cut the pollution to minimum. – As the climate change is a major problem in front of humans, the changes in the basic system of industrialization is necessary. – The Tata group has a set of explicit guidelines on environmental and ecological issues, and a broad range of policies aimed at helping Tata companies protect, conserve and restore our natural resources. – It is quite clear that the major pollution is caused by automobile industry and other commodities. Tata has its share of problems in this sector as it launched the new product Tata nano the low price car which is also to be sold in the European market by nano europa. UK Market: PESTEL Analysis
  30. 30. • Environmental: – Jaguar and land rover in UK have a different story, which is asking for more investment to meet the fuel-economy regulation in EU. – Land Rover doesn’t have a single model that comes near the EU's proposed 120g/km CO2 fleet average emissions rating, let alone an entire fleet averaging this, – While Jaguar’s emissions levels are only marginally better. UK Market: PESTEL Analysis
  31. 31. UK Market: Promotions
  32. 32. Tata Motors Hispano Carrocera SA: Spain International Marketing
  33. 33. • TATA HISPANO is a prominent manufacturer of bus and coach bodywork in Spain and Morocco, with sales in several other countries of Europe. • TATA HISPANO is a 100% subsidiary of TATA Motors, the largest automobile manufacturer of India, World‘s second largest bus manufacturer and World‘s fourth largest truck manufacturer. Background: Hispano Carrocera SA: Spain
  34. 34. • Political landscape – The prime minister has launched a cross-party "anti-crisis" commission aimed at arriving on a agreement to address the severe and ongoing recession. Spain Market: PESTLE Analysis
  35. 35. • Economic landscape – The government set out its proposals to grant more loans to small businesses amongst other measures on which it hopes to obtain cross- party support to revive its stumbling economy. Spain Market: PESTLE Analysis
  36. 36. • Social landscape – The healthcare needs of its population are also being adequately met by the public sector, although initiatives have been undertaken to increase the involvement of the private sector. – The labor market of Spain is moving from a system of temporary contracts to permanent contracts. It will provide long-term predictability to employers with respect to available employees. Spain Market: PESTLE Analysis
  37. 37. • Technological landscape – Spain Market is Technologically evolved market as compared to India – But the country fares poorly in terms of the number of patents received as compared to France in Germany. Spain Market: PESTLE Analysis
  38. 38. • Legal landscape – Spanish law permits foreign investment of up to 100% of equity, and capital movements are completely liberalized. – The authority of the Spanish competition commission has been widened to make enforcement more effective. Spain Market: PESTLE Analysis
  39. 39. • Environmental landscape – The country's environmental policies have been developed along EU guidelines. – The strategy on sustainable development and on climate change has been approved to reduce GHG emissions by developing a technical construction code and a bonus system to encourage people to buy energy efficient vehicles. Spain Market: PESTLE Analysis
  40. 40. Spain Market: Promotions
  41. 41. • There are two ways firms compete are by either – a differentiation strategy or – a low cost strategy. • However, as we've seen the route TML has taken involves competing on both strategies. • While the Nano targets the price conscious common man, the Jaguar Land Rover deal shows us that TML is now targeting brand conscious, high-end consumers. • In the whole; the group is acquiring the different strategy in the different markets, in the home country Tata’s strategies are same as to cost leadership and differentiation. Conclusion
  42. 42. • Tata Motors is an overall strong company that has found strength and expansion through its parent company, Tata Group, but also through its numerous acquisitions and mergers. • Although Tata Motors stock prices have fallen since the start of the 2008 year due to suggestions that Tata Motors is overreaching by adding luxury brands to pair with the Nano, the world's cheapest car. • Chairman of Tata Group, Ratan Tata, rejects suggestions that, ``We're not trying to be a global player,'' he told reporters in New Delhi Jan. 10 after unveiling the Nano, which will be built in a new plant costing 10 billion rupees ($249 million). • ``We will grow internationally in select markets'' (Krishnamoorthy). Ratan Tata’s Say
  43. 43. Thank You! Group Presentation by Jaswinder Singh (3), Kemrad Lakdawala (17), Tushar Pingulkar (30), Rajesh Pisat (31), Dimple Salian (36), Rahul Shinde (44)