PROJECT REPORT ON “Effect of Declining Market on TATA Motors” BY NILESH R. MANGHWANI AM 26 P.G.D.M (MRKT) 2008-2010SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION AND RESEARCH PUNE- 411048
ACKNOWLEDGEMENTWriting is a solitary task. However turning of millions of bytes of information requires anarmy of talented folks . I have been fortunate enough to be assisted by many talentedand caring people. And I wish to express my appreciation all those help has been mostvaluable.To all these truly outstanding people , and many others too , my warm personal regard .I am indeed grateful to my Director Mr. Sunil Kumar and Guardian Mr. Vishal Bhole andclass co-ordinator Mrs. Manisha Landefor providing me the necessary guidance andfacility required for completion of this project and for being an effective source ofinspiration. I am thankful to the library for providing the necessary magazines andjournals without which the completion of this project would not be possible. Your’s Faithfuly Nilesh .R. Manghwani
CERTIFICATEThis is to certify that the Project title Effect of Declining Market on TATA Motors is abonafide work carried out by NILESH R. MANGHWANI student of P.G.D.M (MRKT) ofSinhgad Institute of Business Administration and Research, Pune for fulfillment of a projectreport . He has worked under our guidance and direction. His work is found to be satisfactoryand complete in all respect.Director Project GuideMr. Sunil Kumar Mr. Vishal BholeDate:Place: SIBAR, PUNE
TABEL OF CONTENTS 1. Global Economic Downturn…………………………………………… 1 2. Impact of US Recession in India………………………………………. 1 3. Impact of Recession on Automobile Industry…………………………. 2 4. The Indian Automobile Industry Today……………………………….. 4 5. TATA Motor ltd Overview…………………………………………….. 5 6. Various Products of TATA Motors…………………………………….. 17 7. Other TATA Services……………………………………………………21 8. Share Holding Pattern of TATA Motors………………………………...22 9. Snapshot Analysis of Company : SWOT………………………………..22 10.Recent Business Decisions………………………………………………23 11.Marketing Strategies……………………………………………………..25 12.Human Resource Strategies……………………………………………...31 13.Operation Strategies……………………………………………………..34 14.Indian Automotive Players(Financial strategies)………………………..36 15.Conclusion………………………………………………………………46 16.Bibliography…………………………………………………………….47
GLOBAL ECONOMIC DOWNTURNDefinition: A recession is a decline in a countrys gross domestic product (GDP) growth for twoor more consecutive quarters of a year. A recession is also preceded by several quarters ofslowing down.Causes: An economy which grows over a period of time tends to slow down the growth as apart of the normal economic cycle. An economy typically expands for 6-10 years and tends to gointo a recession for about six months to 2 years. A recession normally takes place when consumers lose confidence in the growth ofthe economy and spend less. This leads to a decreased demand for goods and services, which in turn leads to adecrease in production, lay-offs and a sharp rise in unemployment. Investors spend less as they fear stocks values will fall and thus stock markets fallon negative sentiment.Impact of a US recession on India: Indian companies have major outsourcing deals from the US. Indias exports to theUS have also grown substantially over the years. The India economy is likely to lose between 1to 2 percentage points in GDP growth in the next fiscal year. Indian companies with big ticketsdeals in the US would see their profit margins shrinking.
The worries for exporters will grow as rupee strengthens further against the dollar.But experts note that the long-term prospects for India are stable. A weak dollar could bringmore foreign money to Indian markets. The whole of Asia would be hit by a recession as itdepends on the US economy. Asia is yet to totally decouple itself (or be independent) from therest of the world.Impact of Recession in the Automobile Industry Global recession has devastated the global auto industry with pinching effects onthe Indian auto industry. India is a strong and growing economy but the hit of recession hasput red marks on the entire balance sheet of the Indian economy. Among the leading car manufacturers, General Motors and Ford were the first one tofile for bankruptcy. GM is struggling to stay alive and claims that the company has just enoughcash to continue its operations. Even the merger talks of GM and Chrysler have been officiallybrought to a halt because of the liquidity crunch. U.S sales have fallen down by 32% which has directly affected the Indian carindustry where GM has recorded a fall of 45%, Ford of 30% and Chrysler down by 35%. All thethree major car manufacturers have reported declined growth after the hit of recession. After the industry experienced a heavy fall in the month of August due to inflation,September proved to be a promising month with things setting out at the right place. Then againthe market went in the negative terrain swayed by the wind of recession.
October usually is considered to be the best month for car sales because of the festiveseason. Unfortunately, this year it proved to be a curse for the Indian auto industry. At one end ofthe spectrum, car manufacturers like Tata Motors, GM, Hyundai, Ford, Renault, Mahindra, andMaruti Suzuki are investing huge amounts to establish new production plants and line up launchof car models. At the other end of the spectrum, SIAM has cut down the growth forecast ofautomotive sales from 12.5% to 9.5%. This initiative taken by SIAM further forced few car manufacturers like Tata Motorsand Maruti Suzuki to cut down their production which further took away the job of almost 300workers. Even Mahindra-Renault reduced the number of production units of their Logan. In addition, the severe liquidity crunch in the U.S market has also forced many of thecar buyers to cut upgrades to bigger cars and many are pushed back from buying new cars. Withdeteriorating car sales, even production has gone down to a great extent, which has eventuallyput a negative impact on the auto component industry. In October, overall car sales declined to about 9.05% over October 2007 and the carproduction fell down to about 12.32%. Further to that even the month of November was notsuccessful in bringing some charm to the industry. Infact, November recorded the steepest fall incar sales in the past five years. Maruti Suzuki recorded a fall of 27%, Mahindra & Mahindra recorded a fall of about40%, and Tata Motors showed 12% decline in the car sales. It is also said that the recent Mumbai terror attack and the cyclonic rain in South Indiahave added to the woes of Indian car manufacturers.The Indian Auto Industry Today
In 2009 estimated rate of growth of India auto industry is going to be 9 percent. Auto industry inIndia has been hit hard by ongoing global financial recession. Sales figures of India automobileindustry for December 2008 have shown devastating after effects of global financial slowdown.However, there is still hope for automobile industry of India in 2009 as there are certain factorsworking in its favor. India is blessed with a middle class, which is getting economically strongerwith every passing day. This class is being touted as potential consumers for India auto industryin years to come.Indian economy has been, more or less, able to withstand tremors of global financial meltdown.Even though its rate of growth has slowed down considerably, there are hopes of an economicrevival. Work force of auto industry of India is relatively well trained.All these factors indicate that there could be a decent future for India auto industry in daysHyundai, a major automobile establishment of South Korea, has put in large sums of money inIndia automobile market. As per its estimates, India auto industry could become a major centerfor small car manufacturing organizations in future.There are some other automobile companies of world who have shown interest in India automarket. Major names among these are General Motors, Skoda Auto and Mercedes-Benz. Thesecompanies have major plans lined up for India auto industry and are likely to invest a hugeamount of money in India automobile marketIndia domestic auto industry has been passing through a tough phase in 2008 and such a trend issupposed to continue in 2009 as well. Leading members of India auto industry have forecast adifficult path in 2009. Shinzo Nakanishi, managing director of Maruti Suzuki, has said that 2009would present them with a number of challenges.
Tata Motors Limited OverviewTata Motors Limited, formerly known as TELCO (TATA Engineering and LocomotiveCompany), is a multinational corporation headquartered in Mumbai, India. It is Indias largestpassenger automobile and commercial vehicle manufacturing company. Part of the Tata Group,and one of the worlds largest manufacturers of commercial vehicles. The OICA ranked it as theworlds 20th largest automaker, based on figures for 2006.Tata Motors was established in 1945, when the company began manufacturing locomotives. Thecompany manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969 Tata Motors was listed on the NYSE in 2004, and in 2005 it wasranked among the top 10 corporations in India with an annual revenue exceeding INR 320billion. In 2004, it bought Daewoos truck manufacturing unit, now known as Tata DaewooCommercial Vehicle, in South Korea. It also, acquired a 21% stake in Hispano Carrocera SA,giving it controlling rights in the company. Tata Motors launched the Tata Nano, noted for its Rs100,000 price-tag, in January 2008.In March 2008, it finalised a deal with Ford Motor Company to acquire their British Jaguar LandRover (JLR) business, which also includes the Rover, Daimler and Lanchester brand names.Thepurchase was completed on 2 June 2008
Tata Motors has its manufacturing base in Jamshedpur, Pantnagar, Lucknow, Ahmedabad andPune.1. HistoryTata Motors launches its first truck in collaboration with Mercedes-BenzTata Motors is a part of the Tata and Sons Group, founded by Jamshedji Nussarwanji Tata and J.Baker. The company was established in 1945 as a locomotive manufacturing unit and laterexpanded its operations to commercial vehicle sector in 1954 after forming a joint venture withDaimler-Benz AG of Germany.2.CarsTata IndicaAfter years of dominating the commercial vehicle market in India, Tata Motors entered thepassenger vehicle market in 1992 by launching the Tata Sierra, a multi utility vehicle. After thelaunch of three more vehicles, namely, Tata Estate (1992, a stationwagon design based on theearlier TataMobile  a light commercial vehicle which some people may still think of asTatas first passenger car), Tata Sumo (LCV, 1994) and Tata Safari (1998, Indias first sportsutility vehicle); In 1998 Tata launched the Indica, the first fully indigenous passenger car of
India. Though the car was initially panned by auto-analysts, the cars excellent fuel economy,powerful engine and aggressive marketing strategy made it one of the best selling cars in thehistory of the Indian automobile industry. A newer version of the car, named Indica V2, was amajor improvement over the previous version and quickly became a mass-favorite. A badgeengineered version of the car was sold in the United Kingdom as the Rover CityRover. TataMotors also successfully exported large quantities of the car to South Africa. The success ofIndica in many ways marked the rise of Tata Motors. Note: In 1996-97 Tata launched the TataSumo Deluxe and the Tata Sierra Turbo variants respectively.3.Daewoo acquisitionMain article: Tata Daewoo Commercial VehicleTata Novus is one of the best selling commercial trucks in South Korea.With the success of Tata Indica, Tata Motors aimed to increase its presence worldwide. In 2004,it acquired the Daewoo Commercial Vehicle Company of South Korea. The reasons behind theacquisition were: Company’s global plans to reduce domestic exposure. The domestic commercial vehicle market is highly cyclical in nature and prone to fluctuations in the domestic economy. Tata Motors has a high domestic exposure of ~94% in the MHCV segment and ~84% in the light commercial vehicle (LCV) segment. Since the domestic commercial vehicle sales of the company are at the mercy of the structural economic factors, it is increasingly looking at the international markets. The company plans to diversify into various markets across the world in both MHCV as well as LCV segments. To expand the product portfolio Tata Motors recently introduced the 25MT GVW Tata Novus from Daewoo’s (South Korea) (TDCV) platform. Tata plans to leverage on the
strong presence of TDCV in the heavy-tonnage range and introduce products in India at an appropriate time. This was mainly to cater to the international market and also to cater to the domestic market where a major improvement in the Road infrastructure was done through the National Highway Development ProjectOn its journey to make an international foot print, it continued its expansion through theintroduction of new products into the market range of buses (Starbus & Globus).4. Joint venturesTata MarcoPolo NON-AC City Bus in Delhi.The NON-AC version is only used in Delhi whileAC versions are used in Bangalore, Mumbai and Delhi alikeIn 2005, sensing the huge opportunity in the fully built bus segment, Tata Motors acquired 21%stake in Hispano Carrocera SA , Aragonese bus manufacturing company and introduced its high-end inter-city buses in the country.Tata Motors has also formed a 51:49 joint venture with Marcopolo S.A., a Brazil-based globalleader, lead by Brian Behrle, in bus body building. This joint venture is to manufacture andassemble fully-built buses and coaches targeted at developing mass rapid transportation systems.The joint venture will absorb technology and expertise in chassis and aggregates from TataMotors, and Marcopolo will provide know-how in processes and systems for bodybuilding andbus body design.
5. Tata AceTata Ace was Indias first mini truckMain article: Tata AceTata Ace, Indias first indigenously developed sub-one ton mini-truck, was launched in May2005. The mini-truck was a huge success in India with auto-analysts claiming that Ace hadchanged the dynamics of the light commercial vehicle (LCV) market in the country by creating anew market segment termed the small commercial vehicle (SCV) segment. Ace rapidly emergedas the first choice for transporters and single truck owners for city and rural transport. ByOctober 2005, LCV sales of Tata Motors had grown by 36.6 percent to 28,537 units due to therising demand for Ace. The Ace was built with a load body produced by Autoline Industries.By2005, Autoline was producing 300 load bodies per day for Tata Motors. Ace is still one of thenumber maker for TML, TML sold the 2,00,000th Ace in August 2008, within 4 years since itsintroduction.Tata Ace has also been exported to several European, South American and African countries.Electric-versions of Tata Ace are sold through Chryslers Global Electric Motorcars division.
6. 2007Tata Pick Up, unveiled in 2007, is expected to enter European and American market by 2009.In 2007, Tata Motors generated revenues of Rs 31,884.69 crore.In 2007, Tata Motors launched several concept models and future designs of existing models. Italso formed joint ventures with various local companies in several countries to assemble Tatacars. Tata Motors launched a re-designed version of Tata Xenon TL during Motor Show Bolognawhich would be assembled in Thailand and Argentina. A pick-up variant of Tata Sumo was alsolaunched under the program Global Pick-Up. The company plans to launch the new pick-upmodel in India, Southeast Asia, Europe, South Africa, Turkey and Saudi Arabia. Tata Motorsalso unveiled newer model of Tata Indigo and Tata Elegante concept-car during the Geneva AutoShow.Tata Motors also formed a joint venture with Fiat and gained access to Fiat’s diesel enginetechnology.Tata Motors is looking to extend its relationship with Fiat and Iveco to othersegments like the Global Pick-Up program. The launch of the Global Pick-Up will mark theentry of the company into developed markets like Europe and the United States. The project wasinitially a collaboration between Tata Motors and its subsidiary Tata Daewoo CommercialVehicles, but later Tata Motors decided to work with Iveco as Daewoo’s design was not in sync
with the needs of sophisticated European customers. The company has formed a joint venturewith Thailand’s Thonburi Company, an independent auto assembler, in which Tata Motors willhold a 70% stake.7.2008 onwards8. Compressed air carMotor Development International of Luxembourg has developed the worlds first prototype of acompressed air car, named OneCAT.In 2007, MDI owner Guy Negre was reported to have "thebacking of Tata"It has airtanks that can be filled in 4 hours by plugging the car into a standard electrical plug. In2008 MDI planned to also design a gas station compressor, which would fill the tanks in 3minutes.There are no gasoline costs and no fossil fuel emissions from the vehicle when run intown, but "the compressed air driving the pistons can be boosted by a fuel burner".OneCAT is a five seat vehicle with a 200-litre (7.1 cu ft) trunk. With full tanks it will run at100 km/h (62 mph) for 90 kilometres (56 mi) range in urban cycle. It is actually a dual fuel carbut it is more efficient than any present Hybrid cars.9. Tata NanoTata NanoTata has developed a car, named Tata Nano, that aims to sell in 2008. It is the least expensiveproduction car in the world: the price is about Rs. 1,00,000 (USD $2,000)The company unveiled
the supermini car during the Auto Expo 2008 exhibition in Pragati Maidan, New Delhi. BajajAuto and Mahindra-Renault have[when?] plans to launch cars in this price range.Tata has faced controversy over developing the Nano. Some environmentalists are concernedthat the launch of such a low-price car could lead to mass motorization in India with adverseeffects on pollution and global warming. There was also strong opposition to the compulsoryacquisition of land for the proposed car factory in Singur West Bengal. NowTata Motors Limitedplan to set up the Nano factory in Sanand, Gujarat, because of the problems faced in WestBengal.To solve this, Tata is goingto produce the E-Nano, an electric version, in partnership withMiljøbil Grenland AS10. Jaguar Cars and Land RoverMain articles: Jaguar Cars and Land RoverAs of 27 March 2008, Tata Motors reached agreement with Ford to purchase their Jaguar andLand Rover operations for US$2 billion. The sale is expected to be completed by the end of thesecond quarter of 2008Tata will also gain the rights to the Daimler, Lanchester, and Rover brandnames.In addition to the brands, Tata Motors has also gained access to 2 design centers and 3 plants inUK. The key acquisition would be of the intellectual property rights related to the technologies.11.Electric vehiclesTata Motors unveiled the electric versions of passenger car Tata Indica and commercial vehicleTata Ace. Both run on lithium batteries . The company has indicated that the electric Indicawould be launched locally in India in about 2010, without disclosing the price. The vehiclewould be launched in Norway in 2009.Tata Motors UK subsidiary, Tata Motors European Technical Centre, has bought a 50.3%holding in electric vehicle technology firm Miljøbil Grenland/Innovasjon of Norway for
US$1.93 M, which specialises in the development of innovative solutions for electric vehicles,and plans to launch the electric Indica hatchback in Europe next year.12. Global operationsThe purchase of Jaguar Cars is expected to help give Tata Motors a foothold in European andAmerican markets.With the unveiling of Tata Elegante during Geneva Motor Show, Tata Motors revealed itsintention to enter the sedan and sports car markets.
Tata Indica during an auto exhibition in Bangkok, Thailand. Indica and Xenon TL will beassembled in Thailand and Argentina.Tata Prima was unveiled during the Geneva Motor Show in 2009. The Luxury Sedan wasdesigned by Pininfrina and has marked the entry of Tata into the international sedan market. Thecar is to be sold in India by 2013 and around the world by 2015Tata Motors has expanded its production and assembly operations to several other countriesincluding South Korea, Thailand, South Africa and Argentina and is planning to set up plants inTurkey, Indonesia and Eastern Europe.13.Global brandsTata Motors has been aggressively acquiring foreign brands to increase its global presence. In2004, Tata Motors bought Daewoos truck manufacturing unit, now known as Tata DaewooCommercial Vehicle, in South Korea. In March 2005, it acquired a 21% stake in HispanoCarrocera SA, giving it controlling rights in the company.On 26 March 2008 Tata Motors agreed to purchase Jaguar Cars and Land Rover from FordMotor in a deal worth $2.3bn (£1.15bn)Tata Motors has also acquired from Ford the rights tothree other brand names: Daimler, Lanchester and Rover. it was rumoured in 2008 that Tata wasin negotiations along with Fiat, General Motors and Renault-Nissan as a possible suitor for therapidly declining Chrysler, which is currently owned by Cerberus Capital Management 14.Present global challenge
Tata Motors have some distinct advantages in comparison to other multi-national competitors.There is definite cost advantage as labor cost is 8-9 percent of sales as against 30-35 percent ofsales in developed economies. Tata motors have extensive backward and forward linkages and itis strongly interwoven with machine tools and metals sectors. Tata Groups strong expertise inthe IT based engineering solution for products and process integration has helped Tata Motors.India has a large auto component industry noted for its world class capabilities. There is hugedemand in domestic markets due to infrastructure developments and Tata Motors is able toleverage its knowledge of Indian market. There are favorable Government polices andregulations to boost the auto industry.However, some major automakers have moved their operations to India to cut costs. Volvoentered India in 1998 to focus on production of its fully built buses. In India, it has focused onproviding economical transport solutions in consonance with its values of safety, quality, andenvironmental care. Its competitive advantage is its high technology which makes the vehicle avery comfortable option to travel through. Tatas trucks have long been reputed for theirunmatched performance, build, and technological advancements that are the flag bearers in theirproduction activities in India. It is still operating in the niche market of high end buses where theTata compete through its Hispano Carrocera and Marcopolo S.A. JV buses.The Government of India announced an automobile policy in December 1997. The policyrequired majority-owned subsidiaries of foreign car firms to invest at least US$50 million inequity if they wished to set up manufacturing projects in India. It also forced them to take onexport obligations to fund their auto part imports and required them to submit to a schedule forincreasing the share of locally made parts in their cars. Mere car assembling operations were notwelcomed.An Indian cabinet panel will soon consider a new automobile policy that aims to set freshinvestment guidelines for foreign firms wishing to manufacture vehicles in the country.Investments in making auto parts by a foreign vehicle maker will also be considered a part of theminimum foreign investment made by it in an auto-making subsidiary in India. The move isaimed at helping India emerge as a hub for global manufacturing and sourcing for auto parts. Thepolicy sets an export target of $1 billion by 2005 and US$2.7 billion by 2010. The policies
adopted by Government will increase competition in domestic market, motivate many foreigncommercial vehicle manufactures to set up shops in India, whom will make India as a productionhub and export to nearest market. Thus Tata Motors CV will have to face tough competition innear future, which might affect its growth negatively.15.Future challengesTata XoverPlastic Car Production- Tata plans on producing a car that is made of nearly 100% plastic. Mahindra and Mahindra: JV with ITEC, North American leader in heavy trucks. M&M has formed a 51:49 JV called Mahindra International with ITEC, USA (parent Navistar International), to manufacture commercial vehicles and to bolster its position in the CV business. ITEC is the leader in medium and heavy trucks and buses in North America, and is the worlds largest manufacturer of medium-duty diesel engines. Mahindra International aims to have a presence across the CV market (6-35 tonnes GVW) with variants of passenger transport, cargo and specialised load applications and is likely to start producing medium/heavy commercial vehicles from FY09. Force Motors Ltd: JV with MAN for manufacturing high-tonnage vehicles Force Motors has paired up with MAN in a 70:30 JV to manufacture high-tonnage and specialty vehicles, such as long-haul trucks, tippers, tractor trailers and multi-axle vehicles in the 16-32 tonne range at its Pithampur plant, with an initial capacity of 24,000 units per
annum and at an investment of Rs7bn. The JV plans to sell nearly half of its production in the domestic market, while the rest is to be exported to the Middle East, Turkey, Russia, Asia and Africa. Further, the two companies have formed another JV to manufacture buses in India from end-2007. Ashok Leyland: Acquisition of Czech Republic-based Avia. Ashok Leyland (ALL) recently acquired the truck unit of Czech Republic-based Avia for US$35m. Avia manufactures 6-9 tonne LCVs and has a capacity of 20,000 units per annum. The acquisition has given ALL direct access to an entire range of Avia trucks, Avia’s press shop with dies and tools, welding lines, state-of-the-art paint shop and R&D facilities. ALL has also entered into technology agreements with Hino Motors of Japan and ZF of Germany to complement its in-house R&D efforts and developing complementary components and aggregates.Various Products of TATA Motors Passenger cars and utility vehiclesTata Indigo SW Tata Sierra Tata Estate Tata Sumo/Spacio
 Commercial vehiclesTata 1616 StarbusTata Marcopolo Buses in the Delhi BRT.
Tata StarBus in Nagpur, Maharashtra. Tata Low Floor Buses are also used by administrations inDelhi, Mumbai, Pune, Udaipur and Indore Tata Ace Tata TL/Telcoline/207 DI Pickup Truck Tata 407 Ex and Ex2 Tata 709 Ex Tata 809 Ex and Ex2 Tata 909 Ex and Ex2 Tata 1109 (Intermediate truck) Tata 1510/1512 (Medium bus) Tata 1610/1616 (Heavy bus) Tata 1613/1615 (Medium truck) Tata 2515/2516 (Medium truck) Tata Starbus (Medium Bus) Tata Globus (Low Floor Bus) Tata Marcopolo Bus (Low Floor Bus) Tata 3015 (Heavy truck) Tata 3118 (Heavy truck) (8X2) Tata 3516 (Heavy truck) Tata 4923 (Ultra-Heavy truck) (6X4) Tata Novus (Heavy truck designed by Tata Daewoo) Military vehicles Tata LSV (Light Specialist Vehicle)
Tata 2 Stretcher Ambulance Tata 407 Troop Carrier, available in hard top, soft top, 4x4, and 4x2 versions Tata LPTA 713 TC (4x4) Tata LPT 709 E Tata SD 1015 TC (4x4) Tata LPTA 1615 TC (4x4) Tata LPTA 1621 TC (6x6) Tata LPTA 1615 TOther Tata services:1) Tata Insurance:Tata AIG Life Insurance Company Limited and Tata AIG General Insurance Company Limited(collectively Tata AIG) are joint ventures of the Tata Group and American International Group, Inc.(AIG). Tata AIG combines the strength and integrity of the Tata Group with AIGs internationalexpertise and financial strength,2) Tata motor finance:Tata Motors is the largest automobile company in this part of Asia. The company has grown in abig way in recent years and has embarked on expansion and acquisition programs. As part of it,Tata Motors has also strengthened and expanded on its finance wing Tata Motor Finance thatprovides for loan and financing options to the customers buying Tata Motors automobiles.TataMotorfinance (TMF) is the automobile financing wing of Tata Motors. It was launched in June2003 and provides for loans on various segments of company automobiles like passenger cars,utility and commercial vehicles along with construction equipments. The company that hasgrown into most of the Indian cities along with a significant presence in some of the foreignmarkets too, today boasts of 109 branches in 22 Indian states.Some of the terms associated with the Tata Motor finance are as follows: Car financing/loan options available for customers belonging to different categories
The repayment period varies to the tune of 36 months-84 monthsThe interest paid on the loans are on the lower endFinance on passenger and commercial vehicles on all Tata vehicles and Fiat modelsPalio and Adventure include top up loans, used vehicle finance, loan takeover andrefinancingThe paperwork is limited and the financing companys representative can be called evenat home to complete the formalities, including calculating the likely Equated MonthlyInstallment (EMI) that the customer might have to pay.
Marketing Strategies a) Introduction of the new Tata nanoThe introduction of the Nano received media attention due to its targeted low price. TheFinancial Times reported[: "If ever there were a symbol of India’s ambitions to become a modernnation, it would surely be the Nano, the tiny car with the even tinier price-tag. A triumph ofhomegrown engineering, the $2,200 (€1,490, £1,186) Nano encapsulates the dream of millionsof Indians groping for a shot at urban prosperity." The car is expected to boost the Indianeconomy, create entrepreneurial-opportunities across India as well as expand the Indian carmarket by 65% The car was envisioned by Ratan Tata, Chairman of the Tata Group and TataMotors, who has described it as an eco-friendly "peoples car". Nano has been greatlyappreciated by many sources and the media for its low-cost and eco-friendly initiatives whichinclude using compressed-air as fuel and an electric-version (E-Nano Tata Group is expected tomass-manufacture the Nano, particularly the electric-version, and, besides selling them in India,to also export them worldwideCritics of the car have questioned its safety in India (where reportedly 90,000 people are killed inroad-accidents every year), and have also criticised the pollution that it would cause (including
criticism by Nobel Peace Prize winner Rajendra Pachauri). However, Tata Motors has promisedthat it would definitely release Nanos eco-friendly models alongside the gasoline-modelThe Nano was originally to have been manufactured at a new factory in Singur, West Bengal, butincreasingly violent protests forced Tata to pull out October 2008. (See Singur factory pulloutbelow.) Currently, Tata Motors is reportedly manufacturing Nano at its existing Pantnagar(Uttarakhand) plant and a mother plant has been proposed for Sanand Gujarat.]The company willbank on existing dealer network for Nano initially. The new Nano Plant could have a capacity of500,000 units, compared to 300,000 for Singur. Gujarat has also agreed to match all theincentives offered by West Bengal government.Cost Cutting features The Nanos boot does not open, instead the rear seats can be folded down to access the boot space It has a single windscreen wiper instead of the usual Some exterior parts of it are glued together, rather than welded. It has no power steering. Its door opening lever was simplified. It has 3 nuts on the wheels instead of the statutory 4 nuts. It only has 1 side view mirrorPriceTata initially targeted the vehicle as "the least expensive production car in the world"aiming for astarting price of 100,000 rupees or approximately US$2000 (using exchange rate as of March 22,2009)6 years ago, despite rapidly rising material prices at the timeAs of August 2008, material costs had risen from 13% to 23% over the car’s development, andTata faced the choice of: introducing the car with an artificially low price through government subsidies and tax- breaks
forgoing profit on the car using vertical-integration to artificially boost profits on cars at the expense of their materials industries partially using inexpensive polymers or biodegradable plastics instead of a full metal- body raising the price of the car option.Model versionsAt its launch the Nano was available in three trim levels: the basic Tata Nano Std priced at 123,000 Rupees has no extras; the deluxe Tata Nano CX at 151,000 Rupees has air conditioning; the deluxe Tata Nano TX at 135,000 Rupees has air conditioning, Yellow Colour Taxi Version; the luxury Tata Nano LX at 172,000 Rupees has air conditioning, power windows and central lockingthe Nano Europa, European version of the Tata Nano has all of the above plus a larger body,bigger 3-cylinder engine, anti-lock braking system (ABS) and meets European crash standardsand emission. The base model will have fixed seats, except for the drivers, which will beadjustable, while the deluxe and luxury models will get air conditioning and body colouredbumpers.
b)Modification in tata sumoNew Tata SumoThe Toyota Qualis and now competes with Chevrolet Tavera. The discontinuation of Qualis tolaunch the Toyota Innova proved advantageous to Tata Sumo. The Sumo has seen a series ofchanges in terms of refinement in this decade. It has been the favourite choice for cab owners, asit is rugged and affordable.The Tata Sumo has been enjoying its position in the MUV market since 1994. It had stiffcompetition with new Sumo Victa has been portrayed as a family lifestyle vehicle, but in fact is acarry over of the old Sumo, with some cosmetic changes. The Sumo comes in nine Victavariants: CX 10/7 Str, DI CX 7/9/10 Str, DI EX 7/9 Str, DI GX 7/9 Str, DI LX 7/9 Str, EX10/7Str, GX 7 Str, GX TC 7 Str, and LX 10/7 Str. All variants, except the Victa DI variants, arepowered by a 2-litre Inline-4 diesel engine. The GX and GX TC variants get a 2-litreturbocharged diesel engine that generates 89 bhp. The Victa DI variants get a 3-litreturbocharged diesel engine. Refinement, both internal and external, is evident across the variants.Tatas latest three variants under the Sumo Grande category are LX, EX and GX available in 2-seater, 7-seater and 8-seater configurations. Sumo Grande boasts of a powerful 2.2-L directinjection common rail (DICOR)engine.
Quick Take * Fuel Economy 9/14 kmpl (city/highway) Available Engines 2.0L Inline-4, 67 bhp diesel 2.0L Inline-4, 89 bhp turbo diesel 3.0L Inline-4, 69 bhp diesel 2.2L DiCOR In-line 4, 118 bhp diesel Available Transmissions 5-speed Manual Transmission (MT)c) New version of indigo,indigo DicorDicor VariantsThe DICOR (common rail diesel) version of Tata Indigo is available in two variants which hasalready hit the bulls eyes. The beefy & bony structured sedan has the capacity to delivermaximum torque of 140Nm @ 1800 - 3000 rpm. The Indigo Dicor from Tata Motors has beenmade apt for Indian roads especially with its driver & co passengers oriented positive attributessuch as : Anti-submarine front seats New electronic instrument cluster with engine RPM meter Rear Seat with double folding backrest Video player with MP3: with headrest mounted LCD screens 1.4-litre as rail diesel engine
Indigo LX DicorTata Indigo LX Dicor on the other hand features manually operated with chrome strip outer rearview window, black dials with chrome rings & star check as the new pattern for itsconsole&ACfascia.Indigo LS DicorTata Indigo LS Dicor features manually operated outer rear view mirror, black dials, & Benzsilver as the new pattern for console & AC fascia. It has no mounted LCD screens.ENGINESPetrol 1396 cc MPFI Petrol Engine with 32-Bit Microprocessor Max. power - 85 PS @ 5500 rpm Max. torque - 12 Kgm @ 3500 rpmDiesel Turbo-charged 1405 cc Indirect Injection Engine with Intercooler Max. Power - 70 PS @ 4500 rpm Max. Torque - 13.5 kgm @ 2500 rpmDicor 32-bit microprocessor based 1396 cc DICOR(Direct Injection Common Rail) 16-valve engine with Dual Over Head Camshafts and a Variable Geometry Turbocharger(VGT) Max.power-70 PS@4000 rpm Max.torque - 140Nm@1800-3000 rpm
e) Tapping of Rural MarketsAccording to the National Council for Applied Economic Research, or NCAER, rural Indiaaccounts for 70% of India’s population, 56% of the national income, 64% of the totalexpenditure and one-third of the total savings. So, the difficulties faced in cracking these marketspale before the huge potential they offer a company. Of the total sales (of consumer goods),around 55% come from rural India, and going ahead, the contribution is likely to grow. NCAERdata suggests that in real terms, at 1999 prices, the size of the rural economy will be about Rs16trillion in 2012-13 compared with Rs12 trillion in 2007-08. The share of non-farm income willbe about two-thirds of the rural economy by 2012-13. Noticing this huge potential Tata motors now plans to tap the rural market, 60 per cent of which runs on cash. Tata motors ltd. are working on strategies to make inroads into these markets.
Human Resource Strategiesa) Hiring PracticesHiring the right talent is the greatest challenge in business environment and new andinnovative hiring strategies are the need of the hour if Indian companies have to succeed inthe changing global scenario. With Indian companies entering the phase of global mergersand acquisitions, already there is a shift in standard hiring practices, the compensationbeing offered, sharing the vision of the company and transmitting a sense of passion in thecompany to the prospective employee will go a long way in attracting the right talent.Some of the innovative hiring strategies could include hiring teams and not just individualsand offering education and placement packages. Over the past few years HR is witnessing adramatic increase in lateral hiring of professionals with some years of experience, hiringfrom the public sector as well as experienced people looking for second careers. Thechallenge facing many firms is to hire with retention.A smart and sophisticated workforce will be the most important corporate resource over thenext 20 The demand for this resource is sure to go up; however, the supply is alreadydwindling.
2.Re-organizing the organizational structure of co.: At the time of recession its important task of hr personal to reorganize the structure ofthe company.so as to avoid extra man force and duplication of work. 3.Reducing in the incentives given to employees.:Human resourse manger should cut incentives of individuals.for ex-If marketing manager used toget incentives for hotelling accommodations 2000 per day.it should be cut down to 1200 perday..as already due to recession he will get equal amount of service by paying the less price.4.providing various offers to employee so to maintain the moral towork hard.It is very important from company point of view to survive in recession.so company shouldprovide different offers and gifts. For achievements of certain targets so as to maintain the moralof working in the company. Of employees..5. No salary cuts and increase in Resource and DevelopmentThey have not cut salaries of employees. But they have reduced the extra working hours, whichmeans the work which is to be done in two hours it has to be completed in two hours. They havereduced delayes in work.
Operations Strategies a) Reducing no. of shifts : Tata motors has reduced its number of shifts frm 3 to 2 in a day and so as to control reduce cost of production. And started making production according to the sales required.b) Quality ManagementQuality management is crucial to effective operations management, particularlycontinuous improvement. More recent advancements in quality, such as benchmarking andTotal Quality Management, have resulted in advancements to operation s management as well.c)Inventory ManagementCosts can be substantial to store and move inventory. Innovative methods, such as Just-in-Timeinventory control, can save costs and move products and services to customers more quickly.
ConclusionOver the period of time, fear of a slowdown in the United States of America have increased. Theimpact of the subprime crisis along with a slowdown in mortgages has led to a significantlowering of growth estimates. Since the United States dominates the global economy, anyslowdown there would have an impact on most of the global economic variables.For India, it could mean a further appreciation in the rupee vis--vis the US dollar and a darkeningof business outlook for sectors dependent on US companies. The overall impact of a USslowdown on India would, however, be minimal as the factors driving growth here are morelocal in nature. Unlike the rest of Asia, India is a strong domestic demand story, so any slowingin the US is likely to have a more muted impact on India. Strong growth in domesticconsumption and significant spending on infrastructure are the two pillars of Indias growth story.No sector has a dominant influence on earnings growth and risks to our estimate are limited.Corporate India is also learning to master the art of efficient capital management, reduction incosts and delivery of value-added services to sustain profit margins. Further, interest rates areexpected to be stable primarily due to control over inflation and proactive measures undertakenby the RBI
BIBLIOGRAPHY Philip Kotler, Kevin Keller, Marketing Management (Twelth Edition) Marketing Management, The McGraw.Hill company, Rajan Saxena (Third Edition) www.pearsoned.co.in/pkotler http://www.genmills.com/corporate/company/india.aspx http://www.utube.comwww.wikipedia.com http://iegd.institut.com http://www.rotman.utoronto.com