International Business ManagementBy:Lysandra D‘silva (1016015)Kranthi (1016077)Joel Pais (1016018) Aloysius Institute of Management and Information Technology
Tata Motors is Indias largest automobile company, with consolidated revenues of Rs 92,519crore ($20 billion) in 2009-10. Tata Motors Limited is an Indian multinational automotivecorporation headquartered in Mumbai, India. Part of the Tata Group, it was formerly known asTELCO (TATA Engineering and Locomotive Company). Its products include passenger cars,trucks, vans and coaches.Through subsidiaries and associate companies, Tata Motors has operations in the UK, SouthKorea, Thailand and Spain. Among them is Jaguar Land Rover, the business comprising the twoiconic British brands. It also has an industrial joint venture with Fiat in India. Tata Motors isSouth Asia‘s largest automobile company; it is the leader in commercial vehicles and among thetop three in passenger vehicles. The company is the worlds fourth largest truck manufacturer,the worlds second largest bus manufacturer, and employs 50,000 workers. Tata Motors hasproduced and sold over 4 million vehicles in India since 1954.Established in 1945, when the company began manufacturing locomotives, the companymanufactured its first commercial vehicle in 1954 in collaboration with Daimler-Benz AG,which ended in 1969. Tata Motors is a dual-listed company traded on both the Bombay StockExchange and New York Stock Exchange. In 2010, Tata Motors surpassed Reliance to win thecoveted title of Indias most valuable brand in an annual survey conducted by Brand Financeand The Economic Times.Tata Motors has auto manufacturing and assembly plants in Jamshedpur, Pantnagar, Lucknow,Sanand, Dharwad and Pune, India, as well as in Argentina, South Africa, Thailand and theUnited Kingdom.Tata Motors is the countrys market leader in commercial vehicles and among the top three inpassenger vehicles. It is also the worlds fourth largest manufacturer of medium / heavycommercial vehicles, and the second largest bus manufacturer. Tata cars, buses and trucks arebeing marketed in several countries in Europe, Africa, the Middle East, South Asia, South EastAsia and South America.The company, formerly known as Tata Engineering and Locomotive Company, beganmanufacturing commercial vehicles in 1954 with a 15-year collaboration agreement with
Daimler Benz of Germany. It has, since, developed Tata Ace, Indias first indigenous lightcommercial vehicle, Tata Safari, Indias first sports utility vehicle, Tata Indica, Indias firstindigenously manufactured passenger car, and the Nano, the worlds cheapest car.Tata Motors has over 1,400 engineers and scientists in six R&D centers in India, South Korea,Spain and the UK.Areas of businessTata Motors makes passenger cars, multi-utility vehicles and light, medium and heavycommercial vehicles. Passenger cars: The company launched the compact Tata Indica in 1998, the sedan Indigo in 2002 and the station wagon Indigo Marina in 2004. Tata Motors also distributes Fiat‘s cars in India. Utility vehicles: The Tata Sumo was launched in 1994 and the Tata Safari in 1998. Commercial vehicles: The commercial vehicle range extends from the light two-tonne truck to heavy dumpers and multi-axled vehicles in the above 40-tonne segment. Passenger buses: The Company also manufactures and sells passenger buses, 12-seaters to 60-seaters, in the light, medium and heavy segments.HistoryTata Motors is a part of the Tata Group manages its share-holding through Tata Sons. Thecompany was established in 1950 as a locomotive manufacturing unit and later expanded itsoperations to commercial vehicle sector in 1954 after forming a joint venture with Daimler-BenzAG of Germany. Despite the success of its commercial vehicles, Tata realized his company hadto diversify and he began to look at other products. Based on consumer demand, he decided thatbuilding a small car would be the most practical new venture. So in 1998 it launched Tata Indica,Indias first fully indigenous passenger car. Designed to be inexpensive and simple to build and
maintain, the Indica became a hit in the Indian market. It was also exported to Europe, especiallythe UK. Tata acquired Spanish bus and coach manufacturer Hispano Carrocera in 2009. In 2006it formed a joint venture with Marcopolo S.A. of Brazil, and introduced low-floor buses in theIndian Market under the name Tata Marcopolo Bus. Recently, it has acquired British JaguarLand Rover (JLR), which includes the Daimler and Lanchester brand names.Acquisitions In 2004 Tata Motors acquired Daewoos 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 €1.85 million. The acquisition is in line with the company‘s objective to enhance its styling/design capabilities to global standards.ExpansionAfter years of dominating the commercial vehicle market in India, Tata Motors entered thepassenger vehicle market in 1991 by launching the Tata Sierra, a multi utility vehicle. After thelaunch of three more vehicles, Tata Estate (1992, a station wagon design based on the earlierTataMobile (1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998,Indias first sports utility vehicle). Tata launched the Indica in 1998, the first fully indigenouspassenger car of India. Though the car was initially panned by auto-analysts, the cars excellentfuel 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 IndicaV2, 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 ofIndica in many ways marked the rise of Tata Motors.ProductsPassenger cars and utility vehicles Tata Nano Europa Tata Vista Tata Starbus Low Floor 1610 Tata Indigo Tata Marcopolo buses in the Delhi Tata Manza BRT. Tata Indigo Marina Tata Aria Tata Winger Tata Sierra (Discontinued) Tata Magic Tata Estate (Discontinued) Tata Nano Tata Sumo/Spacio Tata Xenon XT Tata Sumo Grande Tata Aria Tata Safari Tata Venture Tata Indica Tata IrisConcept vehicles 2000 Aria Roadster 2007 Tata Elegante 2001 Aria Coupe 2009 Tata Pr1ma 2002 Tata Indiva 2010 Tata Versa 2004 Tata Indigo Advent 2010 Tata Essota 2005 Tata Xover 2011 Tata Pixel 2006 Tata CliffriderCommercial vehicles Tata Ace Tata TL/Telcoline/207 DI Pickup Truck Tata Super Ace Tata 407 Ex and Ex2
Tata 709 Ex Tata Divo (Fully built luxury coach) Tata 809 Ex and Ex2 Tata CityRide (12 – 20 seater buses for Tata 909 Ex and Ex2 intra-city use) Tata 1109 (Intermediate truck) Tata 3015 (Heavy truck) Tata 1512 (Medium bus chassis) Tata 3118 (Heavy truck) (8×2) Tata 1612/1616 (Heavy bus chassis) Tata 3516 (Heavy truck) Tata 1618 (Semi Low Floor bus chassis) Tata 4018 (Heavy truck) Tata 1623 (Rear Engined Low Floor bus Tata 4923 (Ultra-Heavy truck) (6×4) chassis) Tata Novus (Heavy truck designed by Tata 1518C (Medium truck) Tata Daewoo) Tata 1613/1615 (Medium truck) Tata Prima (The World Truck designed Tata 2515/2516 (Medium truck) by Tata Motors and Tata Daewoo) Tata Starbus (Branded Buses for city, inter city, school bus and standard passenger transportation)Military vehicles Tata LSV (Light Specialist Vehicle) Tata LPT 709 E Tata Mine Protected Vehicle (4×4) Tata SD 1015 TC (4×4) Tata 2 Stretcher Ambulance Tata LPTA 1615 TC (4×4) Tata 407 Troop Carrier, available in Tata LPTA 1621 TC (6×6) hard top, soft top, 4×4, and 4×2 versions Tata LPTA 1615 TC (4×2) Tata LPTA 713 TC (4×4) Tata Winger Passenger Mini Bus
Tata Motors technology and design subsidiariesTata has dozens of technology and design subsidiaries. These include the main ones.Telco Construction Equipment (TELCON)TELCON is a joint venture between Tata Motors and Hitachi, which focuses on excavators andother construction equipment. and research work are done.HV Transmission (HVTL) and HV Axles (HVAL)HVAL and HVTL are 85% subsidiary companies of Tata Motors engaged in the business ofmanufacture of gear boxes and axles for heavy and medium commercial vehicles, withproduction facilities and infrastructure based at Jamshedpur.Tata Technologies Limited (TTL)TTL provides Engineering and Design (E&D) solutions to the Automotive Industry. Tata Motorsholds 86.91% of TTL‘s share capital. TTL is based in Pune (Hinjawadi) and operates in the USand Europe through its wholly owned subsidiaries in Detroit and London respectively. It also hasa presence in Thailand. Tata Technologies is a software service provider in the IT services andBPO space. Its global client list includes Ford, General Motors, Toyota and Honda, to name afew. It bought over the British engineering and design services company, Incat International Plcfor Rs.4 billion in August 2005. Incat specializes in engineering & design services and productlifecycle management in the international automotive, aerospace and engineering markets. Withthis acquisition, Tata Motors will have closer proximity to its global customers and be able toprovide a wider range of services.Tata Motor European Technical CentreTata Motor European Technical Centre is Tatas subsidiary based in the UK. It was the jointdeveloper of the World Truck.
OperationsTata in IndiaTata Motors Limited is India‘s largest automobile company, with revenues of 35,651.48 crore(US$7.23 billion) in 2007–08. It is the leader in commercial vehicles in each segment, andamong the top three in passenger vehicles in India with products in the compact, midsize car andutility vehicle segments. Tata vehicles are sold primarily in India, and over 4 million Tatavehicles 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 FiatGroup Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiatpowertrains. The company is establishing a new plant at Sanand (Gujarat). Tatas dealership,sales, service and spare parts network comprises over 3500 touch points. Tata Motors alsodistributes and markets Fiat branded cars in India. Sales & Service NetworkTata Motors has more than 250 dealerships in more than 195 cities across 27 states and 4 UnionTerritories of India. It has the 3rd largest Sales and Service Network after Maruti Suzuki andHyundai.Tatas global operationsTata 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. Amongthese acquisitions is Jaguar Land Rover, a business comprising two struggling iconic Britishbrands that was acquired from the Ford Motor Company in 2008. In 2004, Tata acquired theDaewoo Commercial Vehicles Company, South Korea‘s second largest truck maker. The re-branded 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 andcoach manufacturer. Tata Motors continued its market area expansion through the introductionof new products such as buses (Starbus & Globus, jointly developed with subsidiary HispanoCarrocera) and trucks (Novus, jointly developed with subsidiary Tata Daewoo). In May, 2009Tata unveiled the Tata World Truck range jointly developed with Tata Daewoo Debuting inSouth Korea, South Africa, the SAARC countries and the Middle-East by the end of 2009. In2006, Tata formed a joint venture with the Brazil-based Marcopolo to manufacture fully builtbuses and coaches for India and other international markets. Tata Motors has expanded itsproduction 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 EasternEurope.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 ispresent in many countries it has only managed to create a large consumer base in the IndianSubcontinent, namely India, Bangladesh, Bhutan, Sri Lanka and Nepal. Tata has a growingconsumer base in Italy, Spain and South Africa.Business excellenceA key vector that has helped Tata companies grow and establish themselves on the global stageas business leaders in their respective fields is the strong business excellence movement in thegroup.One of the initiatives in the business excellence movement is a framework known as the TataBusiness Excellence Model (TBEM), which has been adapted from the renowned MalcolmBaldrige archetype. TBEM assesses core aspects of business operations: leadership, strategic
planning, customer focus, measurement, analysis and knowledge management, workforce focus,process management and business results.The model works under the aegis of Tata Quality Management Services (TQMS), an in-houseorganisation mandated to help different Tata companies achieve their business excellence andimprovement goals.In recent years, the TBEM framework has been adapted to include new business and societalinitiatives such as governance, safety, climate change and innovation.The other core elements of the Tata business excellence movement are the Tata Code of Conduct(TCoC), a mandatory pan-Tata policy that defines how Tata employees can conduct themselves,and the Management of Business Ethics, a programme that helps Tata companies drive ethicsand values in the organisation.Since the 1990s, there is a formal arrangement that governs the relationship between individualTata companies and the superstructure that is the Tata group. In order to use the Tatanomenclature, a group company has to sign a contract called the Brand Equity and BusinessPromotion (BEBP) Agreement. This places an obligation on the company signing on to adoptTBEM and TCoC as a means to attaining business leadership.As a result, the business excellence processes have come to characterise the Tata way ofenhancing and conducting its business endeavours, and to a great extent, have helped define theTata brand.The TBEM movement in Tata has a built-in reward and recognition mechanism whereincompanies that have achieved a score of 600 on the TBEM framework are felicitated with theJRD QV Award.TQMSTata Quality Management Services (TQMS), a division of Tata Sons (the principal promotercompany of the Tata group of companies), is a trusted partner, working closely with Tatacompanies to achieve their business excellence and improvement goals.
TQMS collaborates with group companies, through long and short-term initiatives, in the areasof innovation, climate change, business ethics, customer focus, improvement, strategydevelopment, safety, human resource, process improvement, corporate governance, training andaffirmative action.Through TBEM, TQMS helps Tata companies gain insights on their strengths and theiropportunities for improvement. This is managed through an annual process of applications andassessments. Each company writes an application wherein it describes, in the context of theTBEM matrix, what it does and how it does it. This submission is then gauged by trainedassessors, who study the application, visit the company and interact with its people. Theassessors map out the strengths and improvement opportunities existing in the company beforeproviding their feedback to its leadership team.TQMS trains and certifies assessors, who are selected from across the group, and it designs andadministers an assessment apparatus that helps them evaluate different Tata companies. Thecontact point person in each company is the corporate quality head, nominated by the CEO asthe business excellence process owner. Typically, each company has a network of businessexcellence people from a variety of functions and locations.The commitment a company makes when it signs the BEBP contract compels it to attain explicitbusiness excellence scores over specific time periods. A result-driven scoring mechanismenables the company to track its progress over time, and ensure that it keeps improving. There isalso an annually administered, group-wide recognition system for companies that exceed acertain score, thereby reflecting excellence, industry leadership and consistent improvement.Implicit in the TQMS approach is the belief that its wide-ranging methodology will enable Tatacompanies to become exemplars — on business as well as ethical parameters — in theirrespective spheres.TBEMThe TBEM methodology has been moulded to deliver strategic direction and drive businessimprovement. It contains elements that enable companies following its directives to capture thebest of global business processes and practices. The model has retained its relevance thanks to
the dynamism built into its core. This translates into an ability to evolve and stay in step withever-changing business performance parameters.The TBEM matrix is used for the organisational self-assessment of Tata companies, recognitionand awards, and for providing feedback to applicants. In addition, TBEM plays three importantsupportive roles in strengthening the competitiveness of Tata companies: It helps improve business excellence practices, capabilities and results. It facilitates communication and sharing of best practices among Tata companies. It serves as a working tool for understanding and managing performance, for providing planning guidance, and for identifying learning opportunities.The TBEM methodology comprises a set of questions that applicant Tata companies have toanswer. Its main objectives are to enhance value to customers and contribute to marketplacesuccess; maximise enterprise-wide effectiveness and capabilities; and deliver organisational andpersonal learning.The core values and concepts of TBEM are embodied in seven categories: leadership; strategicplanning; customer focus; measurement, analysis and knowledge management; workforce focus;process management; and business results. The TBEM system focuses on certain key areas ofbusiness performance: customer-focused results; product and service results; financial andmarket results; human resource results; organisational effectiveness results; governance andsocial responsibility results.JRD QV AwardWhile quality has always been one of the cornerstones of the Tata way of business, the need tointroduce a formal system that calibrated how different group companies were faring on thisscale began to be felt in the early 1990s. That led to the institution, in 1995, of the JRD Quality
Value Awards, the forerunner to TBEM. Named after JRD Tata, the late chairman of the groupand a crusader for the cause of business excellence in Tata companies, the awards have now beenincorporated in TBEM.Jehangir Ratanji Dadabhoy Tata, or JRD, as he was popularly known in business circles, guidedthe destiny of India‘s largest business house for well over half a century. Over the years that hewas at the helm of affairs of the group, JRD Tata helped establish many new enterprises.He was always conscious about the importance of quality, and ensured that this qualityconsciousness prevailed in all the organisations that belonged to the Tata group. He was proudthat the companies within the group were known, domestically and internationally, for thequality of their products and services.As a tribute to his quest for perfection in every sphere of activity, the JRD Tata Quality ValueAward was instituted in his memory.The JRD QV Award is modelled on the lines of the Malcolm Baldrige National Quality Award,integrating beneficial attributes from other national quality awards. The award recognises acompany within the Tata group, which excels in quality management and has achieved thehighest levels of quality.This is an annual award presented to the winning company on the 29th day of July, the birthanniversary of JRD Tata.The objectives of the award are: This award is given to group companies in order to create awareness on the importance of the value of quality and the need for total customer satisfaction in all areas of operations within the Tata group companies. To achieve and sustain continuous excellence and consequently leadership in the marketplace through perfection and the achievement of quality which will be recognised as being the best and ahead of competition.
Evaluation processTata companies participate in a bi-annual process of external assessments. The idea is to subjectthem to an assessment, based on the excellence parameters embedded in the Tata BusinessExcellence Model (TBEM).Each company writes an application in which it describes what job it does and how it does thejob in the context of the criteria set by TBEM. This application is then assessed by trainedTBEM assessors who study the document, visit the company and interact with its people, drawout the strengths and the improvement opportunities, and then provide feedback to the leadershipteam. An in-built scoring mechanism enables the company to track its progress over time, andensure that it keeps improving.Criteria for recognition: JRD QV Award: 600+ for the first time Leadership in Excellence: 700+ for the first time Sustained Excellence: 3 successive improvements beyond 600 Active Promotion: 500 to 600 for the first time Serious Adoption: 450 to 500 for the first time High Delta: High improvement in one year min 75 for 500- High Delta 500+: High improvement in one year min 50 High Delta 600+: High improvement in one year min 25Addressing climate changeThe Tata group is facing up to the challenge of climate change and making it integral to itsprocesses. The broad idea is to develop a common approach to the critical questions confrontingthe groups businesses on the environmental front, and formulate policies that can dealeffectively with issues that impact climate change.
Coordinating and directing the climate change efforts of the groups companies is Tata QualityManagement Services (TQMS), a centrally administered organisation that draws on theexperience and expertise of senior Tata leaders.The Tata group considers climate change to be a serious issue and is taking the following steps toincrease carbon consciousness and institute mitigation strategies: A steering committee and working group have been assigned to address the climate change issue and cascade it into a group-level movement. Tata companies from five business sectors — steel, automotive, power, chemicals and IT — will participate in the first phase through the following strategies: o Intensive awareness and training programmes will be conducted for senior leadership. Climate change champions will be identified in each company. o Policies on energy efficiencies, green buildings, green data centres and green protocols will be developed. Awareness will be created amongst all stakeholders. o Individual Tata companies will measure their current carbon footprint to assess where the group stands. This will be extrapolated for future years. o Cost abatement curves will be established and mitigation strategies identified for the major companies. Other Tata companies will follow in the second phase. o The climate change initiative will be integrated with the Tata groups internal business excellence framework, the Tata Business Excellence Model, in order to further motivate and encourage companies.Climate change policy for Tata companiesTata companies will play a leadership role in climate change by being knowledgeable,responsive and trustworthy, and by adopting environment-friendly technologies, businesspractices and innovation, while pursuing their own growth aspirations and the enhancement ofshareholder value. Tata companies will measure their carbon footprint and will strive to: Be the benchmark in their segment of industry on the carbon footprint, for their plants and operations.
Engage actively in climate change advocacy and the shaping of regulations in different business sectors. Incorporate ‗green‘ perspective in all key organisational processes.Global Presence:Tata in Asia PacificAsia Pacific is a key market for the Tata group as it enjoys a strong brand presence in theregion — apart from the Indian sub-continent, Tata is present in Singapore, Thailand, Vietnam,Indonesia, Malaysia, the Philippines, South Korea, Australia and China.Although most Tata companies are headquartered in India, the groups growing global spread hasresulted in the Asia Pacific region becoming a significant base of operations as well. Singapore isthe headquarters of Tata Technologies and Tata NYK and also the regional headquarters of TataConsultancy Services.Several Tata companies have set up manufacturing plants, sales and marketing operations andrepresentative offices around the region. For instance, NatSteel, a Tata Steel company, is theleading provider of steel in the region with plants and bases in several Asia Pacific nations. Asignificant portion of Tata Communications network is located in the area.Tata Motors has two large operations — Tata Daewoo in South Korea and Thonburi AutomotiveAssembly Plant Company in Thailand. Indian Hotels has set up several Taj properties in the area,including its luxury getaways in Malaysia, Bhutan and the Maldives, and the Blue in Sydney.Tata in ChinaChina is a critical and growing market for the Tata group, which has a bit of history with regardto doing business with the Middle Kingdom. In 1859, a young Jamsetji Tata, the founder of theTata group, was sent to Hong Kong to open a branch for his fathers banking firm. He relocated afew months later to Shanghai, where he remained till 1863.
Currently the Tata group has a fairly significant presence in China, with the number ofcompanies and operations growing steadily. Tata companies employ over 2,600 employees inChina, generated $3 billion worth of sales in the country and purchased goods and services worth$700 million in 2010.Recognising the potential for high growth in existing businesses and opportunities for new ones,Tata Sons, the group promoter company, has set up representation in China.Tata motors in North AmericanTata TTM -0.36% has received twice as many orders for the $2,000 micro car as it is set up to deliverthrough 2010. Some investors nevertheless expressed dismay Tuesday, disappointed that Tata didnt haulin even more orders.Its a problem anyone still holding stock in Ford F +0.68% or General Motors GM +0.04%might relish.Detroit need not fear an imminent incursion of home turf by the Nano. There are no Tata Motorsdistributorships in North America, creating a protective buffer zone that for the time being affords a goodchuckle.Seriously. Whats the likelihood that a car with a 650 cc, two-cylinder engine with a top speed of 63 mphposes a threat to anything larger than a scooter?America has a long history of making fun of little foreign cars. Back in the 1950s, it was the VolkswagenBeetle. But then it sort of caught on. In the 1960s, the jokes were aimed at those little Japanese importsfrom Toyota and Datsun. And who can forget those dinky Honda Civics? All were dismissed as cheapknock-offs of what we knew to be real cars.Then came the 1973 Arab oil embargo, gasoline shortages, and suddenly our precious land yachts werebeing swapped at par for those little foreign jobs that, despite initial skepticism, seemed to holding uppretty well after all.
Gradually the U.S. auto industry realized it was losing home court advantage to the imports. The backlashwas painful and palpable. No one in their right mind would park a Toyota on the streets of the Motor Citywithout fearing it would be keyed by some angry patriot.Eventually we found new cars to joke about. Now its Tatas turn.But theres a pattern here. Like earlier invaders, Tata is backed by a company much bigger and a historymuch older than we care to recognize.While the Nano grabs headlines, its only the latest model in a Tata lineup of sedans, SUVs andcommercial vehicles. Tata has a distributor network that spans parts of Europe, Asia and Africa. And it isin full growth mode, teamed up with Fiat IT:F +3.18% and capitalizing on some staggering productionadvantages when sized up against North American competitors.Given the evolution of the industry over the past 60 years, Tata is bound to face lots of jokes. But Detroitneeds to take this relative newcomer deadly serious because they are going to find themselves in head-to-head competition for many of the same overseas customers and, just as importantly, the same pool ofinvestor capital.Retail Production of tata motors in north AmericanTata motors is considering pooling engine production. Ratan Tata, chairman of the Indian holding groupwhose automotive business owns Jaguar Land Rover, has spoken of setting up joint engine production forits mass-market Indian operations and the two UK premium brands.JLR, which specialises in high-end executive saloons and four-by-fours, had in the past spoken ofbuilding engines in the UK or India, but this is the first time Tata Motors has spoken of combining thetwo parts of its business.―To optimise the synergetic strengths between JLR and Tata Motors in India, an examination is alsounder way on a joint engine development programme which would have manufacturing facilities both inthe UK and India‖, Mr Tata said in the company‘s annual report, released on Monday.JLR currently gets its engines from Ford Motor, which sold the premium carmakers to Tata for $2.3bn in2008.
Joint engine development with India‘s largest carmaker – best known for the tiny, cheap Nano – could bea sensitive topic for Jaguar and Land Rover on the competitive premium-car market. Tata is investing atleast £5bn over the next five years to improve the quality of the car brands‘ products and designs, as ittakes on Germany‘s larger premium car marques.Jaguar‘s image took a knock under Ford‘s ownership, when the brand‘s X-Type car was criticised forhaving too much in common with the Ford Mondeo.However, since then carmakers – including the German premium producers – have establishedincreasingly global manufacturing operations or teamed up with mass-market rivals, as they seek to cutcosts and build cars closer to where they sell them.BMW and Daimler‘s Mercedes-Benz brand make cars in the US, and rival premium brand Audi isconsidering a US production site. Daimler is co-operating with mass-market carmakers Renault andNissan in areas including small cars and commercial vehicles.Chas Hallett, editor of Britain‘s WhatCar magazine, said: ―I don‘t think where things are made has anybearing on consumers any more. What‘s more important are that [JLR‘s] cars are engineered anddesigned in Britain. Where they‘re actually manufactured is irrelevant‖.Jaguar and Land Rover have rebounded strongly since the financial crisis, on the back of reviving globaldemand for premium cars and well-reviewed products such as the recently launched Range RoverEvoque.In an interview last month, Ralf Speth, JLR‘s chief executive, said that the carmakers had not yet decidedon an engine strategy.Mr Speth said: ―We have a long-term contract with Ford. We don‘t need another partner.‖ However, headded that if JLR decided to produce its own engines, the company might do so ―either in the UK or inIndia or both‖.Industry observers widely expect the UK carmakers to develop their own capacity for what is seen as acore automotive technology. Rival UK premium carmaker Aston Martin, which Ford sold in 2007, saidearlierthis month it had extended an agreement to buy engines from Ford, due to lapse in 2012, for at leastfour more years.Production process of Tata motors in north American1) Build out a network of dealerships versus utilize existing distribution networks.
2) Import all completed cars from India versus setting up an auto manufacturing plant in the US orMexico.Import Finished Cars from India or Build an Auto Manufacturing Plant Many large foreign autocompanies import thousands, sometimes millions, of cars into the US each year. Toyota, for example,imports so many vehicles that it operates its own logistical branch, Toyota Logistics Services (TLS),which operates container ships and organizes import activities for many of Toyota‘s imports.Accordingly, economies of scale benefit these companies and make importing each vehicle relativelyinexpensive when compared to the cost of setting up an auto manufacturing plant for those same cars herein the US or in Mexico. Further, the private nature of these types of logistics subsidiaries makes itdifficult to determine the exact cost of importing a vehicle. While a breakdown of the complete importsupply chain follows in a later section, estimating the cost to push a vehicle through Tata‘s supply chain iscontained in Exhibit 6. This simple financial analysis compares the roughly $600 estimated cost ofimporting each Nano to the US to the prospective capital outlay that building a Nano factory wouldrequire, around $225 million on the low-end. While these figures are not directly comparable, they doplay a role in determining whether importing or building in North America is the better route.The prospect of spending $225 million to build a North American factory is supported by the very lowtransportation cost that Tata would pay in delivering completed cars from the factory to its dealerships inthe US. This is where the benefits end, however, as lengthy list of cons presents itself. First, spending thismuch capital is an unlikely option for Tata as intra-Asia and European expansion are the company‘s mainconcerns right now. The establishment of a dealer network involves many millions of dollars, however itsoperational and long-term strategic benefits are immediately clear. Second, the standardization of parts inTata vehicles makes the current Nano plant‘s location in India ideal, as many of the same parts Tata usesin other vehicles are included in the Nano. Third, the Tata CEO has said that the Nano plant in India hasbeen designed for customizing Nanos for sale in the European and US markets. The current Nano factoryis located in Sanand, Gujarat State, India, along the country‘s Western coast. It has capacity to produce250,000 vehicles annually. Demand for the Nano in India is currently far below this figure, and anefficient supply chain delivery Nano parts to the factory is already in place. These facts reveal thatbuilding another Nano plant in North America would be largely redundant.Another issue to consider is Tata‘s current supply chain which brings parts from across Asia to the Nanoplant in Sanand. Were a new factory in North America to be setup, this supply chain would need to beexpanded to bring all the same parts to the new factory, located on the opposite side of the world. Withhardly any North American parts suppliers at present, setting up a factory in the US or Mexico would
require establishing an expensive new supply chain to ship nearly all the separate Nano parts overseas.When further considering that labor costs in North America are far higher than those in India, it appearsthat myriad new costs would result from this additional supply chain. Exhibit 7 details the difference inpay rates among skilled auto workers in various countries. The bottom-line impact, should Tata moveproduction to a US location, would be an additional $49 million in labor costs. This is an outrageousfigure which would boost the retail price of the Nano more than $500 higher.The wage rates for auto workers in Mexico and India are actually nearly the same. Mexican productionfacilities would only incur an additional half-million dollars in labor cost, an amount that would be morethan accounted for by savings in finished-car shipping costs and NAFTA tariff reductions. Conversely,the added inefficiencies of establishing a redundant supply chain (one leading to the plant in India andone leading to a plant in Mexico) would result in costs that far outweigh the potential savings fromlocalized finished-car shipping. For this reason, it is clear that importing finished Nano cars from India isthe best fiscal choice for Tata. Only later, once the company has an established foothold in the US marketand is ready to introduce new products to it, should Tata consider constructing an auto manufacturingplant somewhere in North America. The risk of US consumers rejecting the Nano is relatively low,though its presence makes the notion of building a plant in North America premature at this time.Tata in South AmericaThe Tata group has had a presence in South America since the 1990s, principally through TataConsultancy Services (TCS), which started its first project in Brazil. Since then the company hasexpanded its reach to 14 countries in the region and today serves more than 150 clients. TCS employsmore than 5,000 people across the South American continent, which is a strategic base in the company‘soperations to service customers in the US and Europe.Among the other Tata companies that have businesses in the region are Tata Motors and Rallis.Additionally, Tata Steel Europe, Tata Chemicals, Tata Communications and Tata International have asales presence in the region.Tata Motors unveils Assembly Plant in South AfricaTata Motors (SA) (Proprietary) Ltd., Tata Motors joint venture with Tata Africa Holding (Pty) Ltd.,today formally opened its assembly plant in South Africa at Rosslyn, north of Pretoria, in the Gautengprovince of South Africa. The establishment of the plant is a major step towards bolstering the operationsand presence of the Tata Group in South Africa.
The plant was inaugurated by South Africas Minister of Trade & Industry, Dr. Rob Davies, in thepresence of top dignitaries from South Africa and India. Among them were Mr. Noel N. Tata, ManagingDirector, Tata International, Mr. Carl-Peter Forster, Group CEO and Managing Director, Tata Motors,Mr. Raman Dhawan, Managing Director, Tata Africa, as well as dealers and key associates of thecompany.Established with an investment of R110 million, the plant can assemble, from semi knocked down (SKD)kits, light, medium and heavy commercial vehicles ranging from 4 tonnes to 50 tonnes, with anannualised capacity of 3,650 vehicles. The capacity can be further expanded as required. The plant hasbeen awarded with ISO 9001 accreditation by Bureau Veritas, South Africa. To begin with, it isassembling two models, the Tata LPT 813 and Tata LPT 1518, both already popular in South Africa.Speaking at the event, Dr. Rob Davies said that the launch of the plant can be attributed to South Africasinvestment friendly policies. He said that the project comes at a time when the department is aggressivelypursuing an industrial development strategy for the South African Medium and Heavy CommercialVehicle (M&HCV) sector."The key focus area of the MHCV strategy is based on: Support for Market Development (Local andRegional), development of OEM Production Capabilities and the Strengthening of the Supply Chains (1sttier Supplier base). Industry role players have and still are part of the extensive consultation process thataccompanies the development of such a strategy. This will be an opportunity for further expansion of TataMotors in South Africa," added Dr. DaviesSpeaking on the occasion, Mr. Carl-Peter Forster said, "With a comprehensive product portfolio, TataMotors is now at a stage where it can consolidate its international business in its chosen markets. Theassembly plant in South Africa is an expression of that resolve. Step by step, we shall expand thefootprint of our international business matching markets and products."Mr. P. M. Telang, Managing Director - India Operations, Tata Motors, said, "We are very proud tocommence assembly operations in South Africa, which has traditionally been among our focus countries.It is integral to Tata Motors international business presence and plans. The company has already carved aniche for itself in the country and is confident of greater opportunities."Built over a period of 18 months, the plant is spread over an area of 34,500 sq. metres. In line with latestworld-class manufacturing practices, the plant has been equipped with state-of-the-art equipment
following lean manufacturing principles. It has built-in flexibilities to assemble large numbers anddifferent variants in mixed mode production, to meet the requirements of the South African market.The entire capital outlay, encompassing civil and plant engineering work for the facility, has been sourcedfrom and carried out by South African suppliers and companies. In addition, all major equipment, likeheavy duty cranes, inversion mechanisms and paint booth, have also been sourced from South Africanvendors. The entire workforce of the plant is from South Africa.Training, skill transfer and development of local workforce is one of the top priorities of the Tata Groupin South Africa. The Tata Groups training processes and facilities in India have been acknowledged asamong the best. Leveraging this expertise through a robust local skill transfer and apprentice programme,Tata Motors South Africa is committed to ensuring that skill levels of individuals employed in variousindustrial trades, such as auto mechanic, welder, painter etc, are further enhanced. Tata has an alreadyestablished state-of-the-art technical training centre in Germiston, Johannesburg, operating since 2006, forskill development of dealer mechanics in South Africa and various other countries in the continent.Tata Motors started exports to South Africa in 1998, with commercial vehicles. Exports of passengervehicles began in 2004. Currently there are over 20 commercial vehicle models .from pick-ups to 49tonne prime movers and from 14-seater buses to luxury coaches -- and 5 passenger vehicle models TataIndica Vista, Tata Indica, Tata Indigo, Tata Indigo SW and Tata Safari in diesel & petrol variants cateringto the needs of the South African market. The company has thus far exported over 32,000 commercialvehicles and 31,000 passenger vehicles to the country. Tata Motors vehicles are available across 85dealerships, through M/s Accordian Investments (Pty) Ltd., the distributor for light commercial vehiclesand passenger vehicles, and M/s Tata Automobile Corporation SA (Pty) Ltd., the distributor for mediumand heavy commercial vehicles.Main occupation of Tata MotorsTata Motors is Indias largest automobile company, with consolidated revenues of INR. 1,23,133 crores ($27 billion) in 2010-11. Through subsidiaries and associate companies, Tata Motors has operations in theUK, South Korea, Thailand and Spain. Among them is Jaguar Land Rover, the business comprising thetwo iconic British brands. It also has an industrial joint venture with Fiat in India. With over 5.9 millionTata vehicles plying in India, Tata Motors is the countrys market leader in commercial vehicles andamong the top three in passenger vehicles. It is also the worlds fourth largest truck manufacturer and the
third largest bus manufacturer. Tata cars, buses and trucks are being marketed in several countries inEurope, Africa, the Middle East, South Asia, South East Asia and South America.Tata motors in UKTata Motors is the leader in commercial vehicles and among the top three in passenger vehicles in India.It is also the worlds fourth largest truck manufacturer and the second largest bus manufacturer. Throughsubsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand andSpain. It also has a strategic alliance with Fiat.In the UK, Tata Motors has set up the Tata Motors‘ European Technical Centre in Warwick, engaged inthe business of design engineering and product development for the automotive industry.In January 2008, Tata Motors unveiled its People‘s Car, the Tata Nano, to be launched later in the year inIndia. A development that signifies a first for the global automobile industry, the Nano brings the comfortand safety of a car within the reach of thousands of families. The high fuel efficiency also ensures that thecar has low carbon dioxide emissions, thereby providing the twin benefits of an affordable transportationsolution with a low carbon footprint.Tata Motors boosts UK production areasThe UK‘s technology base has been given a major boost with the announcement that Tata Motors‘European Technical Centre is to expand its partnership with experts at Warwick University.The TMETC plans to increase its team of highly skilled engineers by 40 per cent over the next two years.Multinational automotive group Tata Motors has invested more than 85 million pounds in research anddevelopment (R&D) at TMETC since it was established on the university campus in 2005.It already has a team of 240 engineers and researchers working alongside colleagues in universitydepartment WMG, with 60 of these hired over the last 12 months because of increased R&D investment.The TMETC aims to increase the engineering and research force by a further 100 to 340 by 2013.Tata Motors is India‘s largest automobile company, headquartered in Mumbai, with revenues of 20 billionUS dollars in 2009-10. The group is the leader in commercial vehicles and among the top three inpassenger vehicles.
In 2004, it bought the Daewoo Commercial Vehicles Company, South Korea‘s second largest truckmaker. Along with many other stake holdings and joint ventures in other leading automotive companiesacross the world, it owns the classic UK brands Jaguar and Land Rover.Dr Tim Leverton, head of Advanced & Product Engineering at Tata Motors Limited, said theannouncement ―represents a further demonstration of Tata‘s long-term commitment to build and developR&D facilities here in the UK. TMETC plays a vital role in Tata Motors‘ global R&D network.―Tata Motors gets access to world-class thoughts, skills and technologies through the TMETC and itscollaboration with WMG. The contribution of TMETC and WMG is important to Tata Motors becomingan international company,‖ he added.Through this arrangement TMETC‘s engineers work alongside researchers at WMG - a universitydepartment occupying a unique position between academia and industry, formerly known as the WarwickManufacturing Group - in low-carbon technology collaborative R&D programmes.They have already started to produce tangible results, for example Tata Motors‘ Vista electric vehicle thatwill be built at a nearby factory in Coventry and will be available to fleet customers in the UK later thisyear.Tata Motors‘ Pixel city car, which was unveiled at the 2011 Geneva Motor Show, has also beendeveloped on the WMG campus. Based on the Tata Nano, the Pixel is a concept vehicle aimed at theEuropean market and features a zero-turn infinitely variable transmission that gives it a turning circleradius of 2.6 metres, making it ideal for dense urban environments.At just over three metres in length the Pixel is claimed to be ―the most package efficient four-seater in theworld,‖ comfortably accommodating four adults.The zero-turn toroidal traction-drive transmission assists rotation of the outer rear wheel forwards and theinner rear wheel backwards, while the front wheels turn at acute angles to achieve its exceptionally tightturning circle radius.―Scissor‖ doors rotate upwards from the front to allow passengers to enter or exit the Pixel, even in thetightest of spaces.The vehicle is also designed to provide a high level of connectivity. Key functions are controlled by thedriver‘s smart phone, running My Tata Connect, the first integrated human-machine interface conceptfrom Tata Motors.
Nick Fell, Tata Motors‘ European Technical Centre‘s director, said: ―WMG and TMETC are building onfive years of successful partnership to further grow TMETC‘s presence at the University of Warwick.―We plan to further increase our team on the campus by up to 100 over the next two years, and arediscussing establishing test and development facilities here. This shows a clear commitment to build anddevelop our R&D and facilities in the UK in collaboration with WMG for the long term.‖This was supported by WMG‘s director Professor Lord Bhattacharyya who said ―Technology businessessuch as Tata are crucial to us solving global challenges that will require new thinking energy, climate-change related technologies.―Tata‘s work alongside WMG will meet those challenges and will even lead the field in new low-carbontechnologies. Tata‘s Pixel concept city car is a clear symbol of Tata‘s current technological prowess andits future aspirations.‖The partnership announcement came shortly after research by the Council for Industry & HigherEducation that indicates that the UK‘s manufacturing sector could be re-energised by a closercollaboration between companies and the science and technology departments at top universities.As well as working with more than 500 UK companies, the university‘s WMG is an international unitwith collaborative centres in the UK, China, India, Malaysia, Russia, Singapore and Thailand.Tata Motors is Indias largest automobile company, with consolidated revenues of Rs 92,519 crore ($20billion) in 2009-10. Through subsidiaries and associate companies, Tata Motors has operations in the UK,South Korea, Thailand and Spain. Among them is Jaguar Land Rover, the business comprising the twoiconic British brands. It also has an industrial joint venture with Fiat in India.Tata Motors is the countrys market leader in commercial vehicles and among the top three in passengervehicles. It is also the worlds fourth largest manufacturer of medium / heavy commercial vehicles, andthe second largest bus manufacturer. Tata cars, buses and trucks are being marketed in several countriesin Europe, Africa, the Middle East, South Asia, South East Asia and South America.The company, formerly known as Tata Engineering and Locomotive Company, began manufacturingcommercial vehicles in 1954 with a 15-year collaboration agreement with Daimler Benz of Germany. Ithas, since, developed Tata Ace, Indias first indigenous light commercial vehicle, Tata Safari, Indias first
sports utility vehicle, Tata Indica, Indias first indigenously manufactured passenger car, and the Nano,the worlds cheapest car.Areas of businessTata Motors makes passenger cars, multi-utility vehicles and light, medium and heavy commercialvehicles. Passenger cars: The company launched the compact Tata Indica in 1998, the sedan Indigo in 2002 and the station wagon Indigo Marina in 2004. Tata Motors also distributes Fiat‘s cars in India. Utility vehicles: The Tata Sumo was launched in 1994 and the Tata Safari in 1998. Commercial vehicles: The commercial vehicle range extends from the light two-tonne truck to heavy dumpers and multi-axled vehicles in the above 40-tonne segment. Passenger buses: The company also manufactures and sells passenger buses, 12-seaters to 60- seaters, in the light, medium and heavy segments. Tata Motors in Africa In a period of just three years, Tata Motors has emerged as the third-largest player in South Africas commercial vehicles market, and one of the fastest growing brands in the passenger vehicles segment Tata Motors has played a major role in Tata Africas origins and current operations in Africa. The journey began in the 1970s with the marketing of Tata Motors heavy vehicles in Zambia. In the 1990s, Tata Africa expanded its automotive operations to Tanzania, Zimbabwe, Malawi, Namibia, Mozambique, Uganda and Ghana. Today, Tata Motors vehicles enjoy leading positions in several vehicle segments in South Africa and Zambia. Tata Motors offers a range of passenger, multi-utility and commercial vehicles: Passenger cars: The popular Indica Commercial vehicles: Telcoline, an all-terrain vehicle suitable for both commercial and private use Heavy commercial vehicles:
Tata Novus new range of Tata Daewoo tippers and tractorsTata Ubuntu and other bus modelsOver the years, the company has established a strong distribution and marketing network with the help ofvarious country-specific Tata Africa subsidiaries. In Ghana, operations cover both vehicle sales andafter-sales. Tata Uganda, set up in 1994, conducts vehicle sales and after-sales business. In Mozambique,Tata De Mozambique Lda (TDML) is engaged in sales and service of Tata vehicles.South Africa has played an important role in the success of Tata Motors in Africa. Launched in SouthAfrica in 2004, the Indica set the record for the most successful car launched in the country. A bus-bodyfabrication plant was set up in 2004 to build indigenously designed buses that are now sold in Zambia,Ghana and Mozambique. The company enjoys a leading position in tippers, medium commercialvehicles (MCV) and heavy vehicles. Recently, Tata Africa Holdings has acquired a Nissanmanufacturing plant in South Africa.Sustaining its leading position in South Africa, the company recently introduced more commercial andpassenger vehicle models: Safari Dicor, to be available in early 2007. Commercial vehicles, new trucks (6 and 10 tonners), tippers (2-6 cubic metre capacity) and bakkies (1.3-tonne flat-bed) are being launched. These vehicles are aimed at meeting diverse transportation needs in South Africa.The new models are on display at Auto Africa 2006 in Johannesburg. Exhibited along with new modelsare, for the first time at the expo, two concept cars — Tata Crossover, a crossover vehicle concept, andTata Cliffrider, a multi-utility lifestyle vehicle. Speaking about the new models, Ravi Kant, managingdirector, Tata Motors, said, "Our endeavour now is to expand our range with improved applications, toreach out to more customers and build a lifetime relationship."Future plans for South Africa are upbeat. "We are looking at increasing our logistical efficiency besidesconsidering options to set up an assembly unit in South Africa. We are also looking at using SouthAfrica as a source for components," says chief financial officer Praveen Kadle. The only commercialvehicle assembly unit the company has outside India is in Bangladesh. Tata Africa managing director,Raman Dhawan, defines future areas of growth and says, "Towards the end of this year, we would beentering the Nigerian and Kenyan markets with our range of commercial vehicles."Apart from the stronghold the company has in South Africa, Tata Motors is among the top automotive
players in other countries as well.In Zambia, the company is at the forefront in the medium commercial vehicles segment. In Ghana, thecompany recently launched a range of passenger vehicles that includes the Indica hatchback, Indigosedan and Indigo Station Wagon, along with the multi-utility vehicle Sumo and the Safari Dicor.According to Divyendu Kumar, head of Tata Motors international business for the passenger car units,the new models will offer superior value to customers in the traditionally important Ghana market.The company is also making progress in other countries such as DR Congo, Ivory Coast, Kenya,Madagascar, Senegal, Tanzania, and Uganda. It is looking at options such as setting up assembly lines,re-working its price and product positioning, improving logistics and accessing local sources.The Tata journey in Africa, which began over three decades ago, has continued uninterrupted, with moremilestones crossed and new strengths gained. Leading the way is Tata Motors, with its ever-expandingrange of luxury and utility vehicles that promise a smoother ride ahead and more milestones to becrossed on the road to excellence.Ventures/ Company of Tata Motors:Jaguar Land RoverJaguar Land Rover Automotive Trading (Shanghai)Jaguar Land Rover Automotive Trading (Shanghai) is the company that handles the Chinaoperations of Jaguar Land Rover (JLR). The companys main activities are the import anddistributionof JLRs range of premium sedans and SUVs in China. Headquartered in Shanghai,the company has a corporate office in Beijing, three distribution facilities (a fourth one to beopened soon) and two technical training academies.JLR China sells its exclusive range of products through a distribution network of approximately60 dealers, providing sales and service coverage across the country. In 2010, it sold
approximately 26,000 units in the country, making it the third largest market for Jaguar LandRover in the world. Given its size and maturity, China has the potential to become JLRs largestglobal market within the next few years.Jaguar Land Rover is a business built around two iconic British car brands that designs,engineers and manufactures in the UK. With investment in product creation topping £1 billion ayear, Jaguar Land Rover is at the centre of the UK automotive industry‘s drive to delivertechnical innovation in all areas of vehicle development.The Jaguar Land Rover business directly employs more than 18,000 people and supportsapproximately 130,000 jobs (through direct employment, dealers, suppliers and broadereconomy). Jaguar Land Rover exports annually generate almost £6 billion for the UK economywith 78 percent of Land Rovers exported to over 160 countries and 70 percent of Jaguarsexported to over 60 countries.Jaguar Cars Limited, founded in 1922, is one of the world‘s premier manufacturers of luxurysaloons and sports cars. Since 1948 Land Rover has been manufacturing authentic 4x4s thatdefine breadth of capability in their segments. The Jaguar XF, XK and XJ models aremanufactured at the companys Castle Bromwich plant in Birmingham. Land Rovers Defender,Discovery 4, Range Rover Sport and Range Rover models are all built at the Solihull plant. TheLand Rover Freelander 2 is built at the Halewood plant in Liverpool.Jaguar Land Rover is a business built around two great British car brands with exceptionaldesign and engineering capabilities. Jaguar Land Rover‘s manufacturing facilities are in the UK.Areas of businessJaguar Cars, founded in 1922, is one of the world‘s premier manufacturers of luxury saloons andsports cars. Land Rover has been manufacturing 4x4s since 1948. Its products have defined thesegments in which they operate.
Jaguar Land Rover‘s manufacturing facilities are in the UK. The Jaguar Land Rover businessemploys over 16,000 people, predominantly in the UK, including some 3,500 engineers at twoproduct development centres, in Whitley in Coventry and Gaydon in Warwickshire.The Jaguar XF, XJ and XK models are manufactured at the companys Castle Bromwich plant inBirmingham, UK, while the Jaguar X-TYPE is produced alongside the Land Rover Freelander 2at the Halewood plant in Liverpool, UK. Land Rovers Defender, Discovery 3, Range RoverSport and Range Rover models are all built at Solihull, UK.The business is a major wealth generator for the UK, with 78 per cent of Land Rovers exportedto 169 countries and 70 per cent of Jaguars exported to 63 countries. Sales to customers areconducted principally through franchised dealers and importers.LocationJaguar Land Rover is based in the UK. Subsidiaries, JVs and Associates Websites Tata Daewoo Commercial Vehicle Company Ltd http://www.tata-daewoo.com/ (TDCV) Tata Marcopolo Motors Ltd (TMML) Tata Hispano Motors Carrocera S. A. http://www.tatahispano.com/ Tata Motors (Thailand) Limited (TMTL) http://www.tatamotors.co.th/ Tata Motors(SA) Proprietary Ltd (TMSA) HV Axles Limited (HVAL) http://www.hvaxles.com/
HV Transmissions Limited (HVTL) http://www.hvtransmissions.com/ Telco Construction Equipment Co. Ltd. (Telcon) http://www.telcon.co.in/ TAL Manufacturing Solutions Ltd. (TAL) http://www.tal.co.in/ Tata Motors European Technical Centre plc. (TMETC) Tata Technologies Ltd. (TTL) and its subsidiaries http://www.tatatechnologies.com/ TML Distribution Company Limited (TDCL) Concorde Motors (India) Ltd. (Concorde) Tata Motors Finance Limited http://www.tmf.co.in/ Tata Motors Insurance Broking & Advisory Services Ltd (TMIBASL) TML Holdings Pte. Ltd. (TML) Sheba Properties Ltd. (Sheba)Tata Daewoo Commercial Vehicle CompanyThe Tata Daewoo Commercial Vehicle Company (TDCV) is South Koreas second largestmanufacturer of medium and heavy-duty trucks. Formerly part of the Daewoo Group, thecompany was acquired by Tata Motors in 2004. With the acquisition of TDCV, Tata Motors hasgrown to become the worlds fifth largest manufacturer of heavy commercial vehicles.
Established in 1983 as the Daewoo Motor Company, the business was spun off as DaewooCommercial Vehicle Company in 2002. TDCV trucks are distributed locally through DaewooMotor Sales Company and are exported to over 60 countries worldwide, including South Africaand China and countries in the Middle East, Southeast Asia and Eastern Europe.Areas of businessTDCV has a product portfolio of over 75 types of trucks in the commercial vehicles segment. Itsproduct range includes flat beds, dumpers, mixers, tractors, arm-roll trucks, refrigeration trucksand special-purpose trucks.LocationThe company‘s headquarters and plant are in Gunsan, South Korea. It has an office in Incheonand sales offices across the country.InternationalizationAs a part of the companys new internationalization strategy, the company has decided to focuson a narrow base of 14-15 countries where market conditions are similar to that of India. In thesecountries, Tata Motors now has dedicated manufacturing facilities, marketing teams and salesteams. The idea is to have self sustained operations in this narrow band of countries. Thecompany evaluates locations on the basis of market opportunities and labour skills. In theframework pertaining to international expansion strategies, Tata Motors can be identified as an Extender,and is focusing on expanding into markets similar to those of the home base, using competenciesdeveloped at home
Where is Tata Motors now and How to Globalize?Korean OperationsTata Motors entered the advanced Korean Market by acquiring Daewoo, with which it hastremendous synergies in terms of product strategy and R & D. Tata Motors has planned to usethis merger and leverage the technology for developing a World Truck for India and internationalmarkets.South African OperationsIn the export market, Tata Motors moved from a fragmented approach to specific markets,chosen in terms of consumer behavior, distribution networks, supply chain, etc. and identifiedSouth Africa as one of the best markets. The sales in this region are about 15,000 units4. This is asignificant improvement over what Tata Motors was cumulatively exporting (8000 units) beforeadopting its new internationalization strategy.Thailand OperationsTata Motors formed a joint venture with Thonburi Automotive Plant to enter Thailand. Thailandis the second most competitive market for pickups, and the new pickup trucks developed herewill be sold in both domestic and export markets.Latin American OperationsTata Motors has taken its alliance with Fiat to produce a new one-tonne pick-up truck, for LatinAmerican markets from Fiats facility in Argentina. This arrangement will also see Tata Motors
forming a joint venture with a subsidiary of Iveco, the commercial vehicle division on Fiat, to setup a distribution network.Now that Tata Motors has established a sustainable model in some countries, its main challengeis to replicate this model in other countries as well.How to replicate this strategy for other markets?Sustainable competitive advantage lies not in one, but a combination of multiple resources, eachof which individually need not necessarily be the best, but in overall weighted average terms,presents the best solution. For Tata Motors, the combination of resources providing itcompetitive superiority on a weighted average basis includes (see Exhibit 3):1. Product Reliability2. Service Network3. Channel Reach Three-way Resource Based ViewIn terms of product reliability, Tata Motors offers products of reasonably high standards. However,foreign players like Volvo and even local competitors like Ashok Leyland arguably offer products that arefar more refined. But this is more than compensated by a dependable service network and extensivechannel reach. Tatas service and distributor network is by far the most extensive of any player in thetrucks industry. Hence in overall weighted average terms, Tata Motors still has a winning proposition.
Recommendation Matrix Based on a close scrutiny of the resource based view of Tata Motors and the challenges it faces, we propose a recommendation matrix arranged along three broad dimensions - Tangible, Intangible and Capabilities Three Dimensional Recommendation Matrix Tangible The strategies in this domain are primarily directed at sustaining Tata Motors first mover advantage with respect to its offering in the Small Commercial Vehicle segment - ACE. Strategy Sustaining the First Movers Advantage of ACE Tata Motors has an unparalleled network of dealers and service stations across the country for Medium and Heavy Commercial Vehicles (M and HCV). However most of these serviceNational stations are along inter-city routes. It would need to replicate this network at intra-city levelFootprint for its hugely successful SCV - the Tata ACE. For this Tata Motors can liaise with small garages, train them and certify them as Tata Authorized Service Station.Product Tata Motors has positioned ACE as a multipurpose vehicle (MPV). This is where Tata
Portfolio Motors can learn from the Maruti small car strategy that posits that there is no such thing as a small car buyer. Hence Tata Motors should endeavour to move form a multi-purpose positioning to a mass customization positioning for ACE, wherein multiple variants are offered on the ACE platform, each uniquely suited for a specific application - such as tippers, long base trawlers, milk carriers. Intangible In intangible terms, Tata Motors needs to bolster its brand loyalty, by providing a unique customer experience. Strategy Intangible Assets In commercial vehicles industry, the uniqueness of customer experience is largely driven by the efficacy of the Support framework. If your car breaks down, you can take a taxi to office. But thats not so for a transport operator. For him, his vehicle is at the heart of his business and hence responsive after-sales support is critical. Minimizing downtime Unique calls for a service network that is highly responsive and easily accessible. Besides, Tata Customer Motors should alsoExperience 1. Consider introducing mobile service units for Tata ACE that can respond to customer calls anywhere within a given city. 2. Start treating "Services" as a dedicated profit center. Towards this end, the company should "productize" annual maintenance contracts. Brand Building a reputation will help sustain sales, without having to engage in discount sales.Reputation Capabilities There are two broad capabilities that Tata Motors should seek to acquire. Strategy Capability Acquisition Technology Technology Appropriation is the key to Tata Motors ambitions to offer products with
Appropriation engines larger than 210 HP. As the share of ultra heavy commercial vehicles grows, the company will need to face up to technologically superior players like Volvo. Here, Tata will have to carefully spearhead its World Truck program by carefully coordinating technology appropriation from its numerous international technology partners, notably Daewoo, Fiat and Hispano. Tata Motors has made significant investments in IT systems to network its countrywide service network. This helps them maintain very high spares partsRobust Supply availability at their service stations and minimize downtime. In the years to come, it Chain would need to include their SCV service station within this framework. This will however be a big challenge, since these service stations would largely be managed by illiterate and not-so-tech-savvy repairmen. Contingency Plans 1. Mass customization has its own shortcomings. Firstly, it puts a disproportionate amount of strain on the companys supply chain. And this is a wasted effort in case the demand patterns arent properly understood. Hence we propose that the sales of the customized vehicles be closely tracked and in case sales achieved within a reasonable timeframe do not merit the additional resource outlay, then the company should revert to the original multipurpose positioning. 2. In the background of rupee appreciation, exports will become costly. Hence it is prudent to open integrated production plants in other countries rather than just concentrating on exports. A few pointers on what Tata Motors ought not to do are captured below: 1. Compete on price because proportion of individual players is low. Instead differentiate through service.
2. Engage in rapid capital expansion given the high debt to equity ratio. Use ring fencing judiciously.3. Focus on rapid acquisitions and instead focus on consolidation in the foreign market.4. Lose focus on the Value for Money positioning, especially in the soon to be launched offering in the Ultra Heavy Commercial Vehicle segmentCulture over viewIn the country the sustainable factor which will be highly influence the motor sectors to grow in such away to success is mainly the culture of the areas this is important aspects when the company want to growin the particular country so main objective peoples behaviors and the acceptance so they are the mainconsideration when globalization take place and the political and geographical aspects also play a roal inthe company this are the main issues in the any company to be the success so they will consider the mainaspect in the international business.Reference:Sours: http://www.time.com/time/world/article/0,8599,1881404,00.html#ixzz1cZDSfj00http://www.ukti.gov.uk/investintheuk/sectoropportunities/moresectors/item/157760.htmlhttp://www.tatamotors.com/media/press-releases.php?id=693