TATA MOTORS

TATA motors is a multinational automotive corporation headquartered in Mumbai, India. It is a part of the TATA group, formerly known as TELCO (TATA Engineering and Locomotive Company).

Tata Motors is India’s largest automobile company, with consolidated revenues of USD 20 billion in 2009-10. It is the leader in commercial vehicles and among the top three in passenger vehicles. Tata Motors has products in the compact, midsize car and utility vehicle segments. The company is the world's fourth largest truck manufacturer, the world's second largest bus manufacturer, and employs 24,000 workers. Since first rolled out in 1954, Tata Motors has produced and sold over 4 million vehicles in India.

Tata Motors is a dual-listed company traded on both the Bombay Stock Exchange, as well as on the New York Stock Exchange. Tata Motors in 2005, was ranked among the top 10 corporations in India with an annual revenue exceeding INR 320 billion. In 2010, Tata Motors surpassed Reliance to win the coveted title of 'India's most valuable brand' in an annual survey conducted by Brand Finance and The Economic Times.

Tata Motors has auto manufacturing and assembly plants in Jamshedpur, Pantnagar, Lucknow, Ahmedabad, Sanand, Dharwad and Pune in India, as well as in Argentina, South Africa and Thailand.

History

Indian manufacturers Tata Motors have quite the history under their belt, starting with the company's foundation in 1945 as a locomotive producer. Tata Motors is just one part of the business group Tata, formerly known as TELCO (Tata Engineering and Locomotive Company), which also has several other ventures, including a steel making plant and even a tea producing company.

Tata got into the motoring business in 1954 when it starting producing heavy trucks in a joint venture with Daimler-Benz AG. So, in 1960. the first truck rolled out of the factory's door in Pune, India, a copy of a German Daimler truck. Tata starting exporting heavy-duty trucks but for the local market, they had to come up with lighter versions because of the infrastructure of the country. The first LCV (Light Commercial Vehicle) model, the Tata 407, began production in 1986.

At the beginning of the 90s, the company sought to evolve and expand into the car market, and it began a collaboration with Cummins Engine Company to produce more efficient diesel engines. Their first car was the Tata Indica, a model that enjoyed an unexpected success both in India and on other European markets, despite the fact that car-analysts gave it bad reviews.

The Indica won people over with it's low fuel consumption and powerful engine. It was so successful that Rover began selling it in the UK under the name of CityRover. The second generation of Indica, the V2, was even more successful.

Indica's major success gave Tata Motors the financial power to take over Daewoo Motors in 2004, in a effort to take their brand more international exposure. Other surprising acquisitions by the Tata Group include Jaguar and Land Rover as of March 26th, 2008 for a net 2 billion US dollars. Lately, Tata has made known its aggressiveness when it comes to gaining exposure and acquiring new brands.

Tata Motors' financial power comes from the fact that its labor costs amount to only 9% of the profit, a reason for which many other car producers, including Volvo decided to move operations to India. Another important factor in Tata's success is the fact that the group holds several machine tools and metal producing plants, further reducing production costs.

Apart from this, Tata does not lack the innovative spirit, bringing to the world the compressed air car (OneCAT) and the the cheapest model ever produced, introduced at the 2008 Geneva auto show, the Tata Nano, a car which will set you back some $2.500. Also, Tata has expressed their wish to come up with a car made 100% out of plastic, in an effort to fight rising costs for metal production.

FUTURE

Tata Aria Uses BorgWarner Torque-On-Demand Transfer CaseCAR PROFILE Tata Aria, the first Indian four-wheel drive crossover vehicle, makes use of BorgWarner's Torque-On-Demand (TOD) transfer case, the Michigan-based automotive supplier announced today. The system reportedly provides on-demand all-wheel drive traction on any surface. ... >> Read more  

Tata Expands European Engineering UnitINDUSTRY Having already stated its goals of becoming a player on the European market, Indian manufacturer Tata Motors is now looking at ways to expand the engineering business it has on the Old Continent, in an attempt to make them pivotal for the future models that it will ... >> Read more  

Tata Motors to Launch Electric Car in EuropeINDUSTRY Nissan has already launched its Leaf in Europe and, although the company still struggles to deal with the growing demand, it enjoys the status of being the only carmaker that sells a mass-produced EV. Competition could join this game very soon and, although many ... >> Read more  

Tata Motors to Launch Nano in Europe by 2013INDUSTRY Tata has presented the so-called Pixel at the 2011 Geneva Auto Show, a new model especially designed to tackle the Old Continent and arrive on European soil in a few years. However, it might seem like the newest model to be launched in Europe won't be the Pixel but the ... >> Read more  

Geneva 2011: Tata Pixel [Live Photos]CONCEPT CAR A new city car concept for Europe has made its world public debut at the Geneva Auto Show today, a vehicle that is based on the Tata Nano, but with ‘Zero Turn’ drive and an innovative diamond-shaped door system. Specifically, the Tata Pixel’s ... >> Read more

Tata Gears Up for Motorsports, Launches Full ThrottleINDUSTRY Tata Motors has until now invested in many market segments, some of which managed to become famous in the whole world, as is the case of the world's most affordable vehicle called Nano. But because investments in India are advancing at a very fast pace, Tata Motors has ... >> Read more  

Tata Nano Diesel to Achieve 2.5 l/100kmCAR PROFILE We're not entirely sure that this is true, but it seems like Volkswagen might have a little surprise in its effort to create one of the most fuel efficient vehicles in the world. Tata Motors is reportedly working on a new version of the Nano that would make the ... >> Read more  

Tata Manza Facelift RevealedCAR PROFILE Indian manufacturer Tata Motors has just unveiled the new Manza, the company's mid-size sedan that goes on sale today across all dealerships in its domestic market. The new Manza will be available with the same Safire petrol and Quadrajet diesel engines developing ... >> Read more  

Tata Motors Launch Venture MPVCAR PROFILE

Tata Motors, India’s largest automaker, has announced the launch of the Tata Venture in BS3 form, which will be available in some parts of Maharashtra. According to the carmaker, the Venture is an MPV that can accommodate up to eight passengers in its three ... >> Read more  

Nano Diesel Coming in September 2011CAR PROFILE The little Nano isn’t exactly a gas-guzzler, but Tata Motors could be introducing an even more frugal, diesel version. The oil-burning Nano could arrive as early as August or September and 2011 and could prove crucial to sales, which have fallen short of the ... >> Read more

JOURNEY FROM RAIL TO ROAD Sixty years ago on June 1, 1945, Tata Sons Limited purchased from the Government of India, the "Tatanagar Shops" - unofficially called the "Singhbhum Shops" - of the East Indian Railway. The purpose was to manufacture steam locomotive boilers, and later, complete locomotive and other engineering products. Tata Sons decided to set up this project as a new company. The "Tata Locomotive and Engineering Company Limited" was incorporated on September 1, 1945. In 1960, the name of the company was inverted and became the "Tata Engineering and Locomotive Company Limited ( TELCO )" giving second place to locomotives. In 1964 Tatas entered into a tripartite partnership with Marshall, Gainsborough, and the Government of India for the manufacture of 950 steam road rollers. The first batch of road rollers was completed on Aprli 22, 1948.

T he company entered in to a technical collaboration with Krauss Maffei of Munich , West Germany for the planning, construction and equipment of the locomotive shops. The first locomotive was dispatched on February 22, 1952. The company dispatched its last locomotive on June 25th 1970. In 1954, an agreement was signed with Daimler- Benz of West Germany for an initial period of 15 years tto place at the disposal of the Indian company the full benefit of their vast technical knowledge and experience for the production of trucks. The product bore the name Tata- Mercedes Benz until June 6th 1969. After which the “Mercedes Star” was replaced by the Tata “T”.The mood in TELCO was upbeat with the visionary. Foreseeing a boom in the automobile industry in an industrially awakened nation J.R.D. TATA and Sumant Moolgaokar set TELCO on the course of expansion with the setting up of a second unit in Pune. The company also acquired the Investa Machine Tool Co. ltd. In Pune. In 1965 construction on the plant began in the Pimpri and Chinchwad area in Pune. Assembly of vehicles commenced at the Pune plant and the first engine was assembled. While the auto operations progressed on the fast track, the other very successful lime of manufacture excavators, was also notching up acclaim.In 1982 the company, which hitherto had concentrated its efforts on giving the market only heavy duty vehicles, moved into the medium heavy duty range with the introduction of the 607, which was later redesigned as 807.In the late 1980’s, the Indian automobile scene was witnessing a radical change. In 1986, TELCO’s R&D wing had a savvy market answer- the 407 series. In the LCV market, the 407 was taking on the avatar of the 1210 in the HCV segment. Following the 407 in quick succession came the 707, 909, and 1510 vehicles. Meanwhile, in 1986 the demand for TELCO vehicles as growing so rapidly that the management took a decision to go in for a third plant in Lucknow.The year 1988 was a watershed in TELCO’s history. Early in the year, Ratan N Tata was appointed Executive Deputy Chairman indicating a clear line of succession.

The year also saw the launch of India’s first fully indigenous pickup truck the Tatamobile. The occasion also marked the Golden jubilee of J.R.D. TATA as the chairman of Tata. As the year drew ti a close, on 28th December to be precise, Ratan Tata took over as chairman from Sumant Moolgaokar.The year 1991, saw TELCO enter the passenger car segment with the launch of the stylish Tata Sierra. Contemporary design, elegance and versatility were features of this vehicle which took the automobile market by storm and became a fashion statement for the rich and the famous. This is followed by the luxury car Tata Estate in 1992. However, 1991 truly belonged to the excavator division. In one year they gave the construction equipment market three new products. While production was proceeding apace at Pune and Jamshedpur, in distant U.P, the Lucknow plant cut its teeth when their first vehicle rolled out on 20th October, 1992.The year 1994, also marked a significant reorganization of the company’s entire business focus and operation. The organization was bifurcated into two business units, the Automobile Business Unit and the Construction Equipment Business Unit. In 1998, Tata Safari – India’s first sports utility vehicle was launched and the Tata Sumo in 1994.With the advent of Indica in 1998, the company accomplished it’s ambition of launching a fill fledged passenger car. This was followed in quick succession by the Indica V2 in 2001 and the Tata Indigo in 2002.TELCO which was renamed Tata motors Limited in 2003 launched City Rover - Indicas fashioned for the European market. The first batch of the city rover rolled out from the Tata motors stabled in 2003 quickly followed by the Indigo Marina in 2004. In 2004 Tata motors also acquired the heavy vehicles unit of Daewoo Motors, South Korea. By 2005 the company was successful in rolling out its 500,00th passenger vehicle. The company now aims at bringing out a car which could be affordable to the common man at a price tag of around one lakh rupees. Tata motors has global presence with exports of vehicles to several countries in Europe, Africa, South America, Middle East, Asia, and Australia and assembly operations in Malaysia, Bangladesh, Kenya, South Africa.One of India’s biggest need is trained workmen. Tata motor’s most outstanding achievement is their system of apprentice training. After their training Tata motor’s apprentices are as good as any workmen anywhere in the world. The company has sent hundreds of its technicians abroad over the years.

The cornerstone of the founder, Jamsetji Tata’s industrial philosophy was based on the principle of trustee ship and the conviction of free enterprise. In order to thrive, one must serve the needs of the society. Over the years, Tata motors has institutionalized many a practice which bears ample testimony to this fact. J.R.D.TATA went a step ahead thinking beyond the workers about the environment in which the companies were operating and about the community at large.

A kaleidoscope of activities is promoted by TATA motors in the areas of community and rural development. The company is also associated with TATA relief committee in its efforts of providing succor to the needy in emergency.The story of TATA motors thus continues. With over 60 years of operation behind them, the company has established itself as the unchallenged market leader in India.

Milestones

1945 - Tata Engineering and Locomotive Co (TELCO) is set up as a locomotive maker at the end of World War Two

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

1977 - Commences production of commercial vehicles

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

1998 - Launches fully indigenous passenger car, Indica

2001 - Ends joint venture with Daimler

2002 - TELCO is renamed Tata Motors

2003 - Announces plan to build world's cheapest car for 100,000 rupees ($2,500)

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

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

2006 - Signs manufacturing and distribution agreement with Fiat, enters venture with Brazilian bus maker Marcopolo

2008 - Named front-runner for Jaguar and Land Rover

Unveils Nano, the 'People's Car', price at about $2,500

RECENT HISTORY OF TATA MOTORS

The Tata Empire has changed dramatically since Ratan Tata took over from his uncle J.R.D. Tata in 1991 -- coincidentally the same year that the Indian government began moving away from its rule by regulation toward economic liberalization. Before 1991, Tata Group and its holding company Tata Sons were said to be like many of the empires of old Asia -- weakly centralized, unable to control its satraps and begums and rajahs, full of formal pomp but empty of power. The Tata Sons holding company and the various family philanthropic trusts had diluted their holdings in many of the companies.

Under Ratan Tata, the center began to take hold. He moved Tata Group out of sectors where it was not competitive, such as textiles and cement, and invested more family capital in sectors that he thought held more promise.

Remarkably, considering the state of overcapacity in the world automobile industry, Tata thought and thinks autos to be one such sector. Where Westerners see a stagnant, legacy industry cursed by overcapacity, he sees it, from an Indian perspective, as a growth industry.

The company that is now Tata Motors made trucks, buses and construction equipment, and it still has a 60% share of India's commercial-vehicle market. But under new marching orders from Ratan Tata, the motor company introduced its first India-designed car in 1997. After some early stumbles, its Indica small car and mid-size Indigo each accounts for about a quarter of their market segments, for a 16% total share of the Indian car market. The Indian car market grew 17% last year, and Tata Motors' volume grew 27%.

Tata Motors (TTM), with a market value of $3.5 billion, is by far the biggest of the Tata companies accessible to American individuals; its American depositary receipts have been listed on the Big Board since September. It reported nearly $4 billion of revenue for the fiscal year ended in March, up 32% from the previous years, and earnings of $283 million, or 79 cents a share, up 41% in dollar terms. The consensus estimate for 2006 is 90 cents a share. The ADRs have been trading at a little below 10, in the middle of a trading range between 12.25 and 8.65 since the listing.

Tata Motors soon will incorporate Tata Finance as a wholly owned subsidiary, and the company says it intends to finance up to 40% of its sales within a few years, up from a current 18%. The company noticed what happened in the U.S. and other countries when captive credit companies made it possible for every car dealer to offer financing with small money down and affordable monthly payments.

Tata Motors is still recovering from an ill-fated partnership with the now-bankrupt Rover Group in Britain, and it has warned of trouble ahead -- increasing competition and a decline in the commercial vehicle sector, and of course the effect of higher fuel prices. Nonetheless, the company plans to make good on a $1.35 billion five-year capital-expenditure program that started in April 2004. That includes the launch of a basic $2,000 car, which, if Tata succeeds, could be the Model-T Ford of the 21st-century developing world. But cars are still cars.

Plant Locations:

Tata Motors’ presence cuts across the length and breadth of India. Over 4 million Tata vehicles ply on Indian roads.The company has four major manufacturing bases in India. These are as follows:1. Jamshedpur (Jharkhand):Established in1945, the Jamshedpur unit was the company's first unit and is spread over an area of 822 acres. It consists of two major divisions - Truck Factory & Engine Factory.The Truck Division boasts of two assembly lines. The main assembly line, measuring 180m in length has 20 work stations with a vehicle rolling out every 8 mins. The other line is dedicated to special purpose vehicles and for meeting the requirements of the Indian Army.2. Pune (Maharashtra):It was established in 1966 and has a Production Engineering Division.To cope with a diverse range of automobiles, four assembly lines have been established, one each for MCVs and HCVs, LCVs, Utility vehicles and one for Passenger Cars (Indica and Indigo).3. Lucknow (Uttar Pradesh): This plant was established in 1992 to meet the demand for Commercial Vehicles in the Indian market. The state of art plant is strongly backed by an Engineering Research Centre and Service set-up to support with latest technology and cater to the complexities of automobile manufacturing.This plant is specialized in the designing and manufacturing of a range of modern buses which includes Low-floor, Ultra Low-floor & CNG Buses.4. Pantnagar (Uttarakhand): The plant began commercial production in August 2007. The plant is spread over 953 acres, of which 337 acres is occupied by the vendor park.

Tata Motors plans to shift the entire production of its mini truck Ace and the passenger carrier variant of the vehicle, Magic, to Uttarakhand.

The company is establishing two new plants at Dharwad (Karnataka) and Sanand (Gujarat).

Following a strategic alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra).

PRODUCTS

Passenger cars and utility vehicle

Tata Sierra (Discontinued) Tata Estate (Discontinued) Tata Sumo/Spacio Tata Sumo Grande Tata Safari Tata Indica Tata Vista Tata Indigo Tata Manza Tata Indigo Marina Tata Winger Tata Magic Tata Nano Tata Xenon XT Tata Aria Tata Venture Tata Iris

Concept cars

TATA Aria Coupe

This car is built on the TATA Aria roadster concept that TATA had unveiled at year 2000 Geneva Auto Show. The TATA Aria coupe and roadster are on the same platform as TATA's B-segment 5-door hatchback car offering - the 1.4 litre TATA Indica.

The TATA Aria Coupé has been conceptualised to be powered by a high performance 1.6 litre - 2.0 litre petrol engines, and has been styled in Italy.

TATA Elegante

TATA Motors unveiled the TATA Elegante, a Sedan Concept based on all new platform, at the 77th Geneva Auto Show in the year 2007.

The TATA Elegante, larger than the current TATA Indigo Sedan, is conceptualized to incorporate 4 cylinder transverse petrol and diesel engines from 1.4 litres through to 2 litres and a compact V6 petrol power unit. Common rail direct injection turbo diesel engines with variable valve timing and capabilities to comply with Euro V emissions norms will also be available. Power varies from 90 to 200 PS with torque of upto 280 Nm. Transmission options include 6 speed manual and automatic gearboxes.

Besides meeting all European safety, crash-worthiness and emission standards, the TATA Elegante's features include satellite navigation system, cruise control, integrated blue tooth compatibility, heated mirrors, rain sensor, front and rear parking sensors, and many other contemporary features. Several of the design cues of the TATA Elegante will be incorporated in the forthcoming generation of TATA Indica and TATA Indigo cars.

TATA Cliffrider

TATA Motors unveiled the TATA Cliffrider, a "Multi-Utility Lifestyle Vehicle" Concept, at the 76th Geneva Auto Show in the year 2006.

The TATA Cliffrider is derived from the TATA "Crossover" Concept, which was originally unveiled at the last Geneva Auto Show. Sporting a silhouette like a high-slung sedan, the TATA Cliffrider is a dynamic package that combines lifestyle  and   sporty   usage with the   practical functionality   of a pick-up truck.

The Concept showcases TATA Motors' idea of how a utility product could evolve in future for the discerning customer through a truly multi-purpose, multi-terrain usage of a car.

The exterior styling cues carry forward the visual theme of the TATA Crossover. The door trims show a continuity of form due to the disguised central pillar, with the front door hinged at its leading edge and the rear door at its trailing edge, allowing better access to the rear seats. The

interior emphasizes space and elegance with an innovative ventilation system and driver-oriented instrumentation stylishly packaged in the steering column. Long beam lights mounted on the roll bar and a load-body suited to carry mountain bikes, skis or snowboards re-inforce the "fun and adventure" image. It can also carry goods in the load tray which can be hidden from view as well as protected from weather conditions by a sliding cover.

Configured to be fitted with a range of Euro IV engines including a V6 Petrol and next generation Common Rail diesel power trains, it would offer multiple airbags, ABS, Traction Control, Navigation Control and a host of other contemporary features. The TATA Cliffrider would be available in 4x2 as well as 4x4 versions.

TATA Aria

TATA showcased in the year 2000 the concept of an exceedingly good looking roadster - a two seater coupe convertible - called the TATA Aria. The then Ms. World Yukta Mookhey, along with the TATA Group Chairman Ratan TATA did the honour of unveiling the Aria to the international press.

Built on the same platform as the TATA Indica, The TATA Aria, proposed to be powered by a 140 hp engine

TATA Crossover

TATA Motors unveiled the TATA Crossover, at the 75th Geneva Auto Show in the year 2005.

The crossover segment "crosses over" traditional definitions for cars and trucks by blending aspects of both. While the trendy crossover has car like construction and ride characteristics, it has the utility of a minivan but with more style and performance.

The TATA Crossover is proposed to be available with a 89 kW-130 kW range option both in diesel and petrol. High ground clearance provides a commanding driving position. Spaciousinteriors provide for flexible seating and ample cargo storage space. A frame-based design and a rugged underbody that's not easily prone to damage make it a tough off-roader. Its distinctive styling gives it a contemporary aggressive and sporty image. The gearbox is offered in 4/5 speed automatic and 5/6 speed manual versions.

TATA Indiva

TATA Motors has unveiled a new 7-seater MPV concept in the year 2002. Built on the same platform as TATA's B-segment offering, the TATA Indica, this MPV concept demonstrates the versatility of the TATA Indica platform.

The TATA MPV, the TATA Indiva has been designed as a compact, space-efficient vehicle and is amongst the shortest 7-seater conceived with an overall length of just under 4.3 metres. It has a high seating position, which enhances passenger comfort, safety and visibility. The interior layout is flexible with the 3rd row of seats being removable which frees up interior space. Sporting 16" alloy wheels, it has been designed as a streamlined peoples' carrier, which is more car-like with on-board electronic systems integrating high level of in-car entertainment, navigation and internet connectivity. The concept has a permanent sunroof and a headliner with LED lighting, which gives the interior an airy, spacious feeling.

Commercial vehicles

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 1512 (Medium bus chassis) Tata 1612/1616 (Heavy bus chassis) Tata 1618 (Semi Low Floor bus chassis) Tata 1623 (Rear Engined Low Floor bus chassis) Tata 1613/1615 (Medium truck) Tata 2515/2516 (Medium truck) Tata Starbus (Branded Buses for city, inter city, school bus and standard passenger

transportation) Tata Divo (Fully built luxury coach) Tata CityRide (12 - 20 seater buses for intra-city use) Tata 3015 (Heavy truck) Tata 3118 (Heavy truck) (8×2) Tata 3516 (Heavy truck) Tata 4018 (Heavy truck) Tata 4923 (Ultra-Heavy truck) (6×4) Tata Novus (Heavy truck designed by Tata Daewoo) Tata Prima (The World Truck designed by Tata Motors and Tata Daewoo)

Military vehicles

Tata LSV (Light Specialist Vehicle) Tata Mine Protected Vehicle (4×4) Tata 2 Stretcher Ambulance Tata 407 Troop Carrier, available in hard top, soft top, 4×4, and 4×2 versions Tata LPTA 713 TC (4×4) Tata LPT 709 E Tata SD 1015 TC (4×4) Tata LPTA 1615 TC (4×4) Tata LPTA 1621 TC (6×6) Tata LPTA 1615 TC (4×2) Tata Winger Passenger Mini Bus

Marketing mix

Marketing is the process by which a product or service originates and is then priced, promoted, and distributed to consumers. The principal marketing functions involve market research and product development, design, and testing. It is the business activity of presenting products or services in such a way as to make them desirable.

One has to consider promotion that is balanced with a suitable product available at a reasonable price, provided at all places to maximize the sale of one’s product.

MARKETING MIXPRODUCT PRICE PROMOTION PLACEBrand Pricing Strategy Personal Selling Channels of DistributionsPackaging Pricing & Quality Advertising Physical DistributionInnovations Price & Alterations Public Relations Wholesaler & RetailersQuality Discounts

1. PRODUCT (Brand, Packaging, Innovations, Quality) :

a. Brand :

Advertising is often used to make consumers aware of a product’s special low price or its

benefits. But an even more important function of advertising is to create an image that

consumers associate with a product, known as the brand image. The brand image goes far

beyond the functional characteristics of the product. The products of Tata Motors have

many special characteristics to them, but when consumers think of it, they not only think

of its features, but they may also associate it with quality, performance, class. All of these

meanings have been added to the product by advertising. Consumers frequently buy the

product not only for its functional characteristics but also because they want to be

identified with the image associated with the brand.

Tata Motors have been successful in creating and maintaining a professional brand

image.

b. Packaging : A vehicle cannot have a material packaging. Here, packaging refers to

and effective assembly of features. Tata Motors provide many innovative features to suit

the target customers and the product. E.g. Tata Safari Dicor has ‘Reverse Guide System’

which includes a weather-proof camera to help the driver while reversing the vehicle.

c. Innovations : The various motives behind buying an automobile are Need, Prestige,

Comfort, Fashion, Jealousy and Novelty. The R & D Department continuously strives to

bring new innovations in their product. Tatas have an industrial experience of over 100

years and they are well known with the Psychology of Indian customers, who desire more

at less price. This experience has helped them to develop products which fulfill the

expectations of Indian consumers.

d. Quality Control : Tata Motors have their Quality Control standards and the QC Dept.

ensures that the customer does not face any inconveniences of a defective product.

2. PRICE (Pricing Strategy, Alterations, Discounts)

a. Pricing Strategy : The prices are fixed keeping in mind a number of factors. As told

by Mr. Desai, prices have to be at par with the prices of the competitors. Tata Motors

give a relative price advantage as compares to its competitors. The various determinants

of price are

i. Market Condition

ii. Costs incurred

iii. Profit percentage desired by the Co.

iv. Dealer Profit

b. Alterations : The Company does not allow any alterations to any of the features of the

product. If there is an alteration which affects the performance of the engine, then the

warranty becomes void. However, there may be alterations in the accessories, if desired

by the customer.

c. Discounts : Discounts are decided by the Co. every month. Any further discounts

made from the profits of the dealer. However, the Co. may compensate the dealer for the

discounts allowed to a certain extent.

3. PROMOTION (Personal Selling, Advertising, Sales Promotion, Public Relations)

a. Personal Selling : There is minimal personal selling involved. The Sales Officers at

the dealerships collect prospective customer databases and perform cold calling to attract

customers.

b. Advertising : Advertising is a form of commercial mass communication designed to

promote the sale of a product or service. Tata Motors is responsible for the advertising of

its products. The dealer does play any role in the advertising. The various media used for

advertising are T.V., Newspapers, Magazines, Hoardings, Internet etc. The dealer

conducts point-of-purchase displays to advertise the products. The advertisements done

by the Co. help the dealer to capitalize on the market.

c. Sales Promotion : The purpose of sales promotion is to supplement and coordinate

advertising and personal selling; Sales promotions are designed to persuade consumers to

purchase immediately by providing special incentives such as cash rebates, prizes, extra

product, or gifts. The Co. conducts intensive sales promotion during festivals such as

festive discounts during Diwali.

d. Public Relations : Public Relations is a management function that creates, develops,

and carries out policies and programs to influence public opinion or public reaction about

an idea, a product, or an organization. The Co. takes serious measures to maintain good

public relations. The Co. follows business ethics to ensure that the customer is satisfied

and receives good service whenever and wherever he desires

4. PLACE (Channels of Distribution, Physical Distribution)

a. Channels of Distribution : In case of vehicles, dealership method of distribution and

sales is generally adopted. Tata Motors have also adopted dealership method of

distribution of its products. The dealers purchase products from the Co. at a negotiated

price. The MRP is fixed by the Co. and the dealer gets a profit within these prices. As the

Co. deals in commercial and passenger vehicles, there may be a single or distinct

dealerships to market its commercial and passenger vehicles in a town. However, if there

is a single dealership appointed, then the commercial and passenger vehicles are managed

under Commercial Vehicles Dept. and Passenger Vehicles Dept. respectively.

Tata Motors have contracts with the Government of India and it supplies buses and

passenger vehicles, in some cases, to the Govt. Sometimes, bulk quantities of vehicles are

ordered by a Govt. Dept. or a private company. The sales, distribution and billing of these

are looked after by the Co. itself.

b. Physical Distribution : The commercial vehicles are manufactured at Jamshedpur,

Lucknow and Pantnagar whereas the passenger vehicles are manufactured at Pune plant.

From the plant, the finished product is transported to the dealerships. The nation-wide

dealership, sales, services and spare parts network comprises over 2,000 touch points.

The dealerships are strategically located in the target and potential markets to ensure

efficient and timely availability of its products in the market.

SWOT

Strengths

The internationalization strategy so far has been to keep local managers in new acquisitions, and to only transplant a couple of senior managers from India into the new market. The benefit is that Tata has been able to exchange expertise. For example after the Daewoo acquisition the Indian company leaned work discipline and how to get the final product 'right first time.'

The company has a strategy in place for the next stage of its expansion. Not only is it focusing upon new products and acquisitions, but it also has a programme of intensive management development in place in order to establish its leaders for tomorrow.

The company has had a successful alliance with Italian mass producer Fiat since 2006. This has enhanced the product portfolio for Tata and Fiat in terms of production and knowledge exchange. For example, the Fiat Palio Style was launched by Tata in 2007, and the companies have an agreement to build a pick-up targeted at Central and South America.

Weaknesses

The company's passenger car products are based upon 3rd and 4th generation platforms, which put Tata Motors Limited at a disadvantage with competing car manufacturers.

Despite buying the Jaguar and Land Rover brands (see opportunities below); Tat has not got a foothold in the luxury car segment in its domestic, Indian market. Is the brand associated with commercial vehicles and low-cost passenger cars to the extent that it has isolated itself from lucrative segments in a more aspiring India?

One weakness which is often not recognized is that in English the word 'tat' means rubbish. Would the brand sensitive British consumer ever buy into such a brand? Maybe not, but they would buy into Fiat, Jaguar and Land Rover (see opportunities and strengths).

Opportunities

In the summer of 2008 Tata Motor's announced that it had successfully purchased the Land Rover and Jaguar brands from Ford Motors for UK £2.3 million. Two of the World's luxury car brand have been added to its portfolio of brands, and will undoubtedly off the company the chance to market vehicles in the luxury segments.

Tata Motors Limited acquired Daewoo Motor's Commercial vehicle business in 2004 for around USD $16 million.

Nano is the cheapest car in the World - retailing at little more than a motorbike. Whilst the World is getting ready for greener alternatives to gas-guzzlers, is the Nano the answer in terms of concept or brand? Incidentally, the new Land Rover and Jaguar models will cost up to 85 times more than a standard Nano!

The new global track platform is about to be launched from its Korean (previously Daewoo) plant. Again, at a time when the World is looking for environmentally friendly transport alternatives, is now the right time to move into this segment? The answer to this question (and the one above) is that new and emerging industrial nations such as India, South Korea and China will have a thirst for low-cost passenger and commercial vehicles. These are the opportunities.

However the company has put in place a very proactive Corporate Social Responsibility (CSR) committee to address potential strategies that will make is operations more sustainable.

The range of Super Milo fuel efficient buses are powered by super-efficient, eco-friendly engines. The bus has optional organic clutch with booster assist and better air intakes that will reduce fuel consumption by up to 10%.

Threats

Other competing car manufacturers have been in the passenger car business for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in terms of quality and lean production.

Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalizes and buys into other brands this problem could be alleviated.

Since the company has focused upon the commercial and small vehicle segments, it has left itself open to competition from overseas companies for the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and Toyota. In fact the entire Indian market has become a target for other global competitors including Maruti Udyog, General Motors, Ford and others.

Rising prices in the global economy could pose a threat to Tata Motors Limited on a couple of fronts. The price of steel and aluminium is increasing putting pressure on the costs of production. Many of Tata's products run on Diesel fuel which is becoming expensive globally and within its traditional home market.

Marketing strategies of Tata motors

1. Product, Branding, and Advertising

Every business started from 0, from no one knows it until everyone know it. Advertising is one of the most common ways to make car buyer or car enthusiast aware of the new car with special promotion price. Another more important way of advertising is to create an image or brand image. Take BMW Z3 for example, it was introduced in 1996 and shortly the car has been used in the famous James Bond movie. This is similar to Nissan 350 Fairlady Z in the recent 2007 Fast and the Furious 3 – Tokyo Drift. Over the years Tata Motors have been successful in creating their brand image especially they use some famous stars as their spokesman.

Other important marketing strategies are such as the packaging, innovations, and quality control. Tata Motors provide many innovative features to attract car lover. One of these innovations is the Tata Safari 4X4 Dicor that has “Reverse Guide System”. A weather-proof camera is fixed to the rear car to help the driver while reversing the car.

2. Pricing Strategy

There are various factors to determine a price of a car. These factors are such as market condition (it can’t be too low or too high with the prices of same vehicle from competitors, it has to be at par), cost incurred to build a car, profit by company, dealer profit.

Giving discount every month and special promotion for certain type of vehicle also one of the strong strategy use by Tata Motors. Discount can be made from Company’s profit or from dealer’s profit at certain range.

3. Place

Place of dealership does play an important role. The channel of distribution, physical location, and dealership method of distribution and sales is generally adopted. The distribution of vehicle must be in a very systematic way, from the plant to dealership and to end user. This is not only in India itself but also to the world-wide dealership. (See also Ford Motor Company SWOT analysis)

4. Maintenance and Support

After sales service is also another important marketing strategy for most of the car buyer to choose for the right car. End user will not want to spend a lot of time to travel to a far place just to service the car such as change engine oil, oil filter and some simple checking. Parts and accessories must also easy to access when it is needed to keep the customer satisfy from buying Tata cars until maintaining the car or even until they sell the car and change to a newer Tata model.

CSRIn addition, the Company has well developed Supplier and Dealer Assessment Processes to take careof issues related to social aspects, which are made a part of the selection process for dealers andsuppliers of the Company. All legal and regulatory requirements need to be fulfilled before finalselection. The Company also periodically audits the job contractors for adherence to labour lawsand other statutory requirements, such as payment of minimum wages, Provident Fund andGratuity etc. The Company also has a special Contracts Cell and Price Panel, which conductsregular compliance audits of contractors and suppliers to ensure their adherence to legalenactments.Beyond our boundaries:Tata Motors, through its Corporate Social Responsibility (CSR) Teams, strives to address therequirements of communities, in particular from the underdeveloped rural areas. Tata Motors has awell-structured process to work towards integrated rural development through concentrating in theareas of health, education, employability and environment. This comprehensive developmentprogramme attempts to improve the standard of living of the community in underdeveloped ruralareas, thereby promoting their basic human rights of access to basic necessities to live a life ofdignity.A summary of the impact created by several community development initiatives in the year 2007-08is given below:Employability – 1,085 youth from areas adjacent to the Company’s plants, were trained in varioustechnical and vocational trades. At the new plant location of Singur alone, over 350 local youthhave been trained in partnership with the government and the social sector, enhancing their

employability.As a part of its skill development programme, the Company has identified 10 Industrial TrainingInstitutes (ITIs) across the country to upgrade their facilities and enhance the relevance of theirprogrammes to industry needs. Of these, four ITIs have been covered in 2007-08. They have beenequipped with the latest machines and tools, the students have been taken on exposure visits tounderstand manufacturing processes and ‘Train the Trainer’ programmes have been organised fortheir faculty.In addition, as a part of the Company’s women empowerment programme, 1,058 women have beentrained in manufacturing food products and utility items, sewing and beautician courses.All the students of the Company-supported Mechanic Motor Vehicle Trade Course, 2007-08, inassociation with the Ramakrishna Mission at Sakwar, Thane district, Maharashtra, have beensuccessfully placed at the Company’s dealerships. Two students from the previous batch have beenfacilitated to open their own workshop on the Mumbai-Ahemdabad HighwayPhoto: Women from the project area of CSR, Pune, who received training in tailoring and were donated sewingmachines under the Women Empowerment initiative, called Bahujan Hitay in PuneHealth - Curative and preventive health services were provided to over 92,390 persons through theCompany’s community health programmes. In Jamshedpur, Jharkhand, 374 individuals benefitedfrom cataract operations conducted free of cost.Global Compact – Communication on Progress, 2007-2008Special country-wide programmes were conducted for drivers during service camps. About 46,548drivers availed of the free general health and eye check-up camps and AIDS awareness programmes.Towards the Company’s drive for total sanitation in adopted villages, 1,940 low-cost toilets wereconstructed.12 hand pumps were installed and three wells were repaired, ensuring clean drinking water supplyfor over 3,500 villagers. Tanker facilities were deployed during summer months to meet drinkingwater requirements of rain-parched rural areas in Pune district, Maharashtra.Photo: Villagers receiving free health check-up and medicines from the Mobile Health Clinic in Lucknowproject areaEducation - Shiksha Prasar Kendra, a Tata Motors society at Jamshedpur, supported 18,000students (of which 7,500 are girls) from across 33 schools. Scholarships for higher studies wereawarded to 375 students. Extra-curricular activities were organised in 31 schools in which over4,300 students participated.Infrastructure was improved at 13 schools, promoting higher education for 2,000 children from over25 villages. This includes a computer laboratory at the Beraberi High School at Singur in WestBengal.

Photo: Mr. S N Ambardekar, Plant Head and Mr. P P Ahir, General Manager, Human Resources, CommercialVehicle Business Unit (CVBU), Pune congratulating the students of Sumant Vidyalaya, a Tata Motors supportedschool in Pimpri Budruk village for performing Mallakhamb steps at their cultural eventEnvironment - Over 175,242 saplings have been planted with 80% survival rate.Community irrigation wells and check dams have been constructed at villages near Pune,augmenting incomes of families through improved irrigation. In Jamshedpur, 85 acres of land hasbeen brought under irrigation and tree plantation has extensively been carried out in over 152acres.Global Compact – Communication on Progress, 2007-2008Photo: Managing Director, Mr. Ravi Kant planting a tree at UttarakhandInternational Locations - Drivers being a key community of the Company, even internationallocations cater to their well-being and skill development. Towards this end, technical training wasprovided at vehicle check-up camps in Sri Lanka, and AIDS awareness formed an integral part ofcheck-up camps in Ghana, benefiting over 100 individuals.

Environment Friendly Technologies• The Company is working with the ‘Department of Science & Technology’ on the ExpertPanel on “Recyclability of automotive Systems & Components”. It is also working withSIAM as a member of task force to study recyclability of vehicles in India.• All manufacturing facilities of the Company are certified to the ISO-14001, InternationalStandard for Environmental Management Systems. The societal & environmental aspects ofproducts and operations & their related impacts have been formally assessed as apart ofthe installed Environmental Management System and Environmental Risk ManagementProcess. Various initiatives like water management system, rain water harvesting, recyclingof treated effluent, eco friendly solid waste management, energy conservation, windenergy, recycling of dirty oils & bio-diesel programme are focused on the Company’s goal topreserve the environment. • The Company continues to preserve and develop natural habitat through its tree plantationand wetland development programmes (also detailed in COP 2006-07)

Initiatives like End-of-Life Vehicle and Recyclability of products, waste management systems, rainwater harvesting initiatives and Tata Motors efforts to preserve the bio-diversity has beendetailed in last years report, COP 2006-07.

Upholding Environment ResponsibilityTata Motors Ltd. considers energy conservation critical to the operation of its manufacturing units.

Apart from reducing operational costs, the energy saved amounts to environment protection by wayof avoiding pollution due to power generation processes. Energy conservation is driven throughoutthe organization, by way of setting Division-wise targets and monitoring performance on everydaybasis for optimizing energy consumption.Company has started several Energy Accounting and Energy Conservation programmes, some ofwhich are highlighted below:• Introducing Fiber Reinforced Plastic blades for man-coolers.• Installing variable speed drive for flow control and energy saving• Introduction of fuel additives in Furnace Oil to improve the combustion efficiency of thefuel.• Soft-start energy savers for hydraulic press motors• Sheds designed for efficient natural lighting.• Use of Compact Fluorescent Lamps, sodium vapour lamps to minimize energy consumption.• Installing portable compressors for isolated running to save compressed air• Harnessing natural daylight by installing translucent roof sheets in workshops• Use of Liquefied Petroleum Gas in place of Light Diesel Oil and Electricity for heating,wherever applicable.• Installation of Turbo Ventilators in forge and Foundry to extract fumes which do not requireenergy to operateRepresentatives of the Company are participating in the following national committees working forimprovement of environment throughout the country:1) Technical committee for “Air quality monitoring, emission inventory and sourceapportionment studies for Indian cities” constituted by Central pollution control board,Delhi2) Group on “Technical evaluation of Automotive Research Association of India reports ondevelopment of emission factors” constituted by Central pollution control board, Delhi3) Technical committee for “Heavy-duty Diesel retrofit demonstration project” constituted byNational environmental engineering research institute, Mumbai4) Multi stakeholder committee to “Develop Better environmental sustainability targets forlead battery manufacturers” constituted by development alternatives, Delhi incollaboration occupational knowledge international, UK and national referral center forlead poisoning, India5) Steering committee for “Mobile Air conditioning Assessment project” constituted by TheEnergy Research Institute (TERI), Delhi

UPHOLDING LABOUR STANDARDSPromoting Freedom of Association and Collective BargainingTata Motors has a reputation of being a fair and a firm employer. At Pune, Jamshedpur andLucknow, the Company has internal unions which are recognized under the Trade Unions Act of1926. The unions represent the workmen and enter into long term wage settlements throughharmonious collective bargaining process.The management has encouraged various forums for the unions to raise any grievances and seekredressal through bipartite forums like an Industrial Relations Committee (Union, Management and

random workmen as observers meet and raise issues, if any, and understand the Company’sposition), Safety Committee (to negate unsafe working conditions) Transport Committee, etc.

Eliminating Child Labour and Forced and Compulsory LabourTata Motors follows all Labour Standards applicable to an Industrial unit. To serve as an audit fromtime to time, the Company has also implemented Social Accountability standards through SA8000which audits the company and its supply chain for forced/compulsory labour, possibility of childlabour, minimum wages, payment of wages, etc.

RESEARCH AND DEVELPOMENT

The foundation of the company’s growth is a deep understanding of economic stimuli and

customer needs, and the ability to translate them into customer-desired offerings through

leading edge R&D. The R&D establishment includes a team of 1400 scientists and engineers.

The company's Engineering Research Centre was established in 1966, and has facilities in

Pune, Jamshedpur and Lucknow. The ERC has enabled pioneering technologies and products.

It was Tata Motors, which developed the first indigenously developed Light Commercial Vehicle,

India's first Sports Utility Vehicle and, in 1998, the Tata Indica, India's first fully indigenous

passenger car. Within two years of launch, Tata Indica became India's largest selling car in its

segment. The ERC in Pune, among whose facilities are India's only certified crash-test facility

and hemi-anechoic chamber for testing of noise and vibration, has received several awards

from the Government of India. Some of the more prominent amongst them are the National

Award for Research and Development Efforts in Industry in the Mechanical Engineering

Industries sector in 1999, the National Award for Successful Commercialisation of Indigenous

Technology by an Industrial Concern in 2000, and the CSIR Diamond Jubilee Technology

Award in 2004.

The company set up the Tata Motors European Technical Centre (TMETC) in 2005 in the UK.

TMETC is engaged in design engineering and development of products, supporting Tata

Motors' skill sets. Tata Daewoo Commercial Vehicle Company and Hispano Carrocera also

have R&D establishments at Gunsan in South Korea and Zaragoza in Spain.

The pace of new product development has quickened through an organisation-wide structured

New Product Introduction (NPI) process. The process with its formal structure for introducing

new vehicles in the market, brings in greater discipline in project execution. The NPI process

helped Tata Motors create a new segment, in 2005, by launching the Tata Ace, India’s first

indigenously developed mini-truck. The years to come will see the introduction of several other

innovative vehicles, all rooted in emerging customer needs. Besides product development, R&D

is also focussing on environment-friendly technologies in emissions and alternative fuels.

Through its subsidiaries, the company is engaged in engineering and automotive solutions,

construction equipment manufacturing, automotive vehicle components manufacturing and

supply chain activities, machine tools and factory automation solutions, high-precision tooling

and plastic and electronic components for automotive and computer applications, and

automotive retailing and service operations.

True to the tradition of the Tata Group, Tata Motors is committed in letter and spirit to Corporate

Social Responsibility. It is a signatory to the United Nations Global Compact, and is engaged in

community and social initiatives on labour and environment standards in compliance with the

principles of the Global Compact. In accordance with this, it plays an active role in community

development, serving rural communities adjacent to its manufacturing locations.

With the foundation of its rich heritage, Tata Motors today is etching a refulgent future.

INTERNATIONAL OPERATIONS

Tata Motors, the first company from India's engineering sector to be listed in the

New York Stock Exchange (September 2004), has also emerged as an international

automobile company. In 2004, it acquired the Daewoo Commercial Vehicles

Company, Korea's second largest truck maker. The rechristened Tata Daewoo

Commercial Vehicles Company has launched several new products in the Korean

market, while also exporting these products to several international markets. Today

two-thirds of heavy commercial vehicle exports out of South Korea are from Tata

Daewoo. In 2005, Tata Motors acquired a 21% stake in Hispano Carrocera, a

reputed Spanish bus and coach manufacturer, with an option to acquire the

remaining stake as well. Hispano's presence is being expanded in other markets. In

2006, it formed a joint venture with the Brazil-based Marcopolo, a global leader in

body-building for buses and coaches to manufacture fully-built buses and coaches

for India and select international markets. Tata Motors also entered into a joint

venture in 2006 with Thonburi Automotive Assembly Plant Company of Thailand to

manufacture and market the company's pickup vehicles in Thailand. In 2006, Tata

Motors and Fiat Auto formed an industrial joint venture at Ranjangaon (near Pune in

Maharashtra, India) to produce both Fiat and Tata cars and Fiat powertrains for the

Indian and overseas markets; Tata Motors already distributes and markets Fiat

branded cars in India. In 2007, Tata Motors and Fiat Auto entered into an agreement

for a Tata license to build a pick-up vehicle bearing the Fiat nameplate at Fiat Group

Automobiles' Plant at Córdoba, Argentina. The pick-up will be sold in South and

Central America and select European markets.

These linkages will further extend Tata Motors' international footprint, established

through exports since 1961. While currently about 18% of its revenues are from

international business, the company's objective is to expand its international

business, both through organic and inorganic growth routes. The company's

commercial and passenger vehicles are already being marketed in several countries

in Europe, Africa, the Middle East, Australia, South East Asia and South Asia. It has

assembly operations in Malaysia, Kenya, Bangladesh, Ukraine, Russia and Senegal.

Tata Motorfinance :

Tata Motorfinance (TMF), the auto financing arm for Tata Motors, came into

existence in June 2003. This was a common front-end, jointly formed by BHPC

(Bureau for Hire Purchase and Credit) of Tata Motors and the asset financing arm of

Tata Finance. This company was a virtual entity, with both the divisions maintaining

their legal identity, and was in the market for exclusively financing Tata Motors

vehicles. Subsequently Tata Finance was merged with Tata Motors and in April 2005

TMF became a division of Tata Motors.

FORBES ARTICLEMUMBAI -

Tata Motors is worried that rising competition, particularly from China, could hurt India's top commercial vehicle maker.

The company plans to spend $3 billion in the next three years to expand as it fights increasing competition from global automakers and a rise in the price of commodities, the company said at its annual shareholders meeting here Monday.

Tata Motors (nyse: TTM - news - people ) is on track to launch an ultra-cheap small car in mid-2008, Tata Group Chairman Ratan Tata said. The automobile will be priced at 100,000 rupees ($2,487.56), which would make it the cheapest vehicle of its kind in India.

Renault (other-otc: RNSDF - news - people ) CEO Carlos Ghosn has announced plans to launch a small car for the Indian market priced at around $3,000. Global giants like Ford, Toyota (nyse: TM - news - people ), General Motors (nyse: GM - news - people ) and Hyundai are also chasing India’s growing middle class as rising salaries push up demand for automobiles.

But the prospect of competition from China is the biggest worry for Tata Motors. “Our greatest concern is when Chinese manufacturers come to India. Most European and U.S. manufacturers are here already,” Tata was quoted as saying. Tata Motors controls 65% of the Indian commercial vehicle market and 19% of the passenger car market. International businesses account for 18% of the company’s revenues.

“We're seeing stagnation in the auto sector globally. We may see a temporary dip in the commercial vehicles sector because of high interest costs and high prices of commodities, and increased competition,” Tata said. Rising interest rates in India also have made car loans dearer

in recent months. But India and China will be the growth drivers in the sector, Tata told shareholders.

In the last quarter, the company’s passenger vehicle sales in India rose 4% to 51,840 units, while commercial vehicle sales declined by 2% to 61,699 units as higher interest rates took a toll on demand. India's car market is expected to triple to 3 million units a year by 2015.

Tata Motors is looking at expansion in markets in South Africa, Latin America, Thailand and China, as it aims to minimize the risks associated with any single market and target high-growth regions. The business has a partnership with Fiat (nyse: FIA - news - people ) for passenger vehicles and trucks.

Tata said some of the challenges the automobile company faced were increasing capacity, retaining product quality and keeping abreast with the latest technology.

Environment

Green MattersTata Motors, Company that cares about the future...

True to the tradition of the Tata Group, Tata Motors is committed in letter and spirit to Corporate Social Responsibility. It is a signatory to the United Nations Global Compact, and is engaged in community and social initiatives on labour and environment standards in compliance with the principles of the Global Compact. In accordance with this, it plays an active role in community development, serving rural communities around its manufacturing locations.

Tata Motors believes in technology for tomorrow. Our products stand testimony to this.Our annual expenditure on R&D is approximately 2% of our turnover. We have also set up two in-house Engineering Research Centres that house India's only Certified Crash Test Facility. We ensure that our products are environmentally sound in a variety of ways. These include reducing hazardous materials in vehicle components, developing extended life lubricants, fluids and using ozone-friendly refrigerants. Tata Motors has been making conscious effort in the implementation of several environmentally sensitive technologies in manufacturing processes. The Company uses some of the world's most advanced equipment for emission check and control.

Tata Motors concern is manifested by a dual approach -

1. Reduction of environmental pollution and regular pollution control drives 2. Restoration of ecological balance.

TATA motors endeavors towards environment protection are soil and water conservation programmes and extensive tree plantation drives. Tata Motors is committed to restoring and preserving environmental balance, by reducing waste and pollutants, conserving resources and recycling materials.

Restoring Ecological BalanceTata Motors has set up effluent treatment facilities in its plants, to avoid release of polluted water into the ecosystem. In Pune, the treated water is conserved in lakes attracting various species of birds from around the world thus turning the space into a green belt.

Tree plantation programmes involving villagers and Tata Motors employees, have turned acres of barren village green. Tata Motors has planted as many as 80,000 trees in the works and the township and more than 2.4 million trees have been planted in Jamshedpur region. Over half a million trees have been planted in the Poona region. Tata Motors has directed all its suppliers to package their products in alternate material instead of wood.

Reducing PollutionTata Motors has been at the forefront of the Indian automobile industry's anti-pollution efforts by introducing cleaner engines. It is the first Indian Company to introduce vehicles with Euro norms well ahead of the mandated dates. Tata Motors' joint venture with Cummins Engine Company, USA, in 1992, was a pioneering effort to introduce emission control technology for India. Over the years, Tata Motors has also made investments in setting up of an advanced emission-testing laboratory.

With the intention of protecting the environment, Tata Motors has upgraded the performance of its entire range of four and six cylinder engines to meet international emission standards. This has been accomplished with the help of world-renowned engine consultants like Ricardo and AVL. These engines are used in Tata Motors vehicles in the Indian market, as well as in over 70 export markets.

Tata Motors is constantly working towards developing alternative fuel engine technologies. It has manufactured CNG version of buses and followed it up with a CNG version of its passenger car, the Indica.

Merger and acquisition

The all-cash deal, which was agreed in March, includes all necessary intellectual property rights, manufacturing plants, two advanced design centers in the UK and a worldwide network of sales companies, Tata Motors said in a statement.

The brands were bought from Ford Motor Co (F.N), which has contributed about $600 million to the Jaguar and Land Rover pension plans, and long-term agreements have been entered into for the supply of engines, stampings and other components.

"Jaguar and Land Rover are two iconic British brands (and) will retain their distinctive identities and continue to pursue their respective business plans as before," Chairman Ratan Tata said in the statement.

"We recognize the significant improvement in the performance of the two brands and look forward to this trend continuing in the coming years."

David Smith, the acting chief executive of Jaguar and Land Rover, will be the new chief executive.

Tata Motors last week said it would raise up to $1.7 billion from three rights issues to help fund the acquisition. On completion of these issues, it would also raise a further $500-$600 million from an overseas equity issues.

The company is scheduled to start selling the Nano, the world's cheapest car priced at just above $2,500, in India later this year.

TRANSITION SUPPORT

Other areas of transition support from Ford include IT, accounting and access to test facilities. The companies will also cooperate in areas such as design and development through sharing of platforms and joint development of hybrid technologies and powertrain engineering, Tata Motors said.

The Ford Motor Credit Company will continue to provide financing for Jaguar Land Rover dealers and customers for a period, and Tata Motors said it was in advanced negotiations with auto finance providers in the UK, Europe and the United States.

Tata Motors, India's top bus and truck maker and No. 3 car maker, has sought to expand its presence in the global markets through alliances and acquisitions in recent years.

It bought South Korea's Daewoo Commercial Vehicles in 2004, and has a minority stake in Spanish bus maker Hispano Carrocera.

It also has ventures with Thailand's Thonburi for pick-up trucks, and with Italy's Fiat (FIA.MI) for manufacturing, distribution and technology, as it gears up for tougher competition at home.

Indian firms have announced overseas mergers and acquisition deals worth nearly $10 billion so far this year, Thomson Reuters data showed, including a $2.6 billion deal at the weekend by Sterlite Industries (STRL.BO) for bankrupt copper miner Asarco.

Ahead of the news of the deal's completion, shares in Tata Motors, worth about $5.1 billion, ended down 2.4 percent at 562.95 rupees. It shares have fallen 24 percent in 2008, compared to a 21 percent decline on the main share index .BSESN.

How Tata Motors turned JLR aroundMumbai: In the summer of 2007, before Tata Motors Ltd took over Jaguar Land Rover (JLR), Ratan Tata and Ravi Kant embarked on a trip through the US. Their objective—to gauge whether the legendary British marques still evoked enough passion in the biggest market for the vehicles to justify the acquisition.

The Tata group was among those that Ford Motor Co., which owned JLR at the time, had approached earlier in the year to discuss a possible sale. Among the people that chairman Tata and Kant, then managing director of Tata Motors, met were the long-suffering dealers of the two brands. Despite the dismal performance over the past few years, the dealers still kept the faith, the Indians were heartened to learn. A few months later, when Kant did the rounds of dealers in the UK, he met with much the same response— they still believed in the brands.

But when the $2.3 billion (Rs. 10,258 crore today) deal took place the next year, it was quickly apparent that Tata Motors couldn’t have picked a worse time to make an acquisition of this magnitude. The collapse of the mortgage market in the US had set off a financial crisis and anyone who had cash wasn’t in the mood to lend it.

Two years and a few months since then, JLR’s contribution has helped Tata Motors post a steep rise in profit in the quarter to 30 September. So how did an Indian company that specialized in cheap small cars, on the one hand, and trucks, on the other, succeed where an iconic auto maker, and others before it, had failed.

The top executives at Tata Motors, usually most reticent, opened up for the first time about the JLR story at an exclusive interaction in Bombay House, the Tata group’s headquarters. Those present at the meeting included Carl-Peter Forster, managing director of Tata Motors group, Ralf Speth, chief executive officer of JLR, and a top group executive who was intimately associated with the turnaround saga, but insisted that he remain unnamed as he wasn’t directly associated with the unit any longer.

Soon after the acquisition in 2008, Tata Motors found itself saddled with a debt of Rs. 21,900 crore, an uncomfortable position for a company that had been virtually debt free.

Meanwhile, at the other end of the spectrum, through 2008 and the early part of 2009, Tata Motors was also involved in developing and launching the world’s cheapest car, Nano, a project that was fraught with its own melodramatic ups and downs. But that’s another story (see WEF special supplement).

Hard times

At JLR, the product wasn’t moving and Bombay House was beginning to feel stretched. Amid talk of the UK government contemplating a bailout of JLR, Tata Motors’ market value plunged toRs 6,503.2 crore, with the stock hitting rock bottom Rs. 126.45 on 20 November 2008. The market capitalization was less than what it had paid Ford for JLR.

“The global slowdown put the company under tremendous pressure because the management of JLR had just separated from one big organization and was attaching itself to another not-so-big group and they were not yet kind of experienced living independently,” said the Tata executive mentioned above. “We were bleeding. Banks were not giving any money, they were not available, they were closed. And we needed money.”

That’s when Ratan Tata came through for Tata Motors, with the parent pumping in capital, driven by the belief that the JLR acquisition was right and would work. While the turnaround, when it took place, came as a surprise, Tata Motors saw it three-four quarters in advance.

But before that, in the fiscal ended March 2009, Tata Motors posted its first annual loss in at least seven years after sales at the luxury units plunged amid the global slump. The consolidated net loss was Rs. 2,500 crore in the year ended 31 March, compared with profit of Rs. 2,200 crore in the year earlier. The JLR unit made a pretax loss of Rs. 1,800 crore as unemployment and the financial crisis damped sales in the US and Europe.

Cash remained “priority No. 1” as JLR was haemorrhaging money and the company sought outside help.

As JLR didn’t have a cash management system of its own, Tata Motors turned to consultants KPMG, Forster said.

For the next few months, “cash started to be managed on an hour-to-hour basis— what cheque was going out, what cheque was coming in”. KPMG declined to participate in the story. Around the same time, in the spring of 2009, Munich-based Roland Berger Strategy Consultants was brought in to keep a tab on costs. The mandate to Roland Berger was simple: make JLR profitable.

Cash management

“A three-tier model was developed,” said Wolfgang Bernhart, partner, Automotive Competence Center, Roland Berger. First, a short-term goal to manage liquidity with the assistance of KPMG was put in place.

Then came a mid-term target to contain costs at various levels and the formation of 10-11 cross-functional teams, Bernhart said. A number of management changes, including new heads at JLR, were made. Finally, a long-term goal that runs until 2014 was drawn up, focusing on new models and refreshing the existing ones. The key aims—cash management and checking costs.

When Roland Berger added up the money that could be saved, the company was astonished at how high the figure was.

A team of young managers was put in charge, in an approach similar to the one followed in the 2003 restructuring at Tata Motors, with reviews on a daily basis.

Tata Motors also embarked on a plan to divest stakes in group companies to raise cash: In September 2008, it sold a 1.3% holding in Tata Steel Ltd to holding company Tata Sons Ltd for a total Rs. 485 crore. In November 2008, the board approved a Rs. 4,147 crore rights offer, which was completed in June this year.

All proceeds were channelled into Tata Motors to make JLR profitable. Crucially, Tata Motors was able to keep product development plans going, which has paid off with the global economy reviving and customers returning to JLR showrooms.

The programme also saw the workforce being trimmed since July 2008 by around 11,000 from a gargantuan workforce of 27,000 at JLR. According to chief financial officer C. Ramakrishnan, who spoke to analysts after announcement of the September quarter results, the workforce was trimmed by another 1,800 to 16,000.

JLR’s turnaround has been aided by external factors. In a 9 November earnings call with analysts, Ramakrishnan said margins had benefited from favourable currency movements, widening by one percentage point to 16.6%, over the first quarter of 2010-11. However, the extent of the turnaround can be gauged when margins are compared with corresponding quarter of previous year. Margins rose by a whopping 1,370 basis points or 13.7% from 2.9% in 30 September 2009-10, reflecting the changed dynamics of the company as sales rose sharply on the

back of new product launches and improved market sentiments. About half the firm’s turnover is dollar-linked while one-fifth is linked to the euro. The rupee has strengthened against both currencies this year. Since January, the pound has strengthened 4.9% against the dollar and 7.7% against the euro.

The turnaround

Sales are buoyant thanks to the introduction of newer, more fuel-efficient and contemporary models coupled with the revival of demand in the firm’s key markets such as the UK, the US and Europe. Despatches of JLR models to dealers globally rose to 115,508 units in the six months to September from 80,252 in the year ago. The new Jaguar XJ has been especially successful, with 8,700 of them having been sold since the model’s launch in mid-May.

With JLR accounting for more than half of Tata Motors’ business, the company posted a 100-fold jump in profit in the three months to 30 September. The debt-to-equity ratio is down to 1.6 times at the consolidated level from from 4.5 times at the end of 31 December 2009. That’s high but comfortable given surging volumes. The share has risen to a respectable Rs. 1,302.15 at close on 10 November on the Bombay Stock Exchange, taking market capitalization to Rs. 79,573.08 crore ($18 billion).

The first real contact between Tata and Ford took place in early 2007 when Ratan Tata got “an informal brief” on JLR. Tata asked Kant and other senior Tata Motors executives if the acquisition made sense. When he got a positive answer, Tata Motors began a nine-month due diligence process.

There were five key issues that persuaded Tata Motors to go ahead. While Jaguar had a mixed reputation, both were still “great brands”. Ford had pumped in a great deal of cash to improve quality and it was just a matter of time before this made a difference. Second, JLR had very good automobile plants. Third was the steadfastness of the dealers despite losses over the past four-five years.

Jaguar cars had already started moving up the ranks of the annual JD Power customer satisfaction rankings. Besides that, there was a crop of great new models in the pipeline, among them the Jaguar XJ and XF and the upcoming Land Rover, which convinced Tata Motors that JLR was on the cusp of change.

Ultimately, Forster says, it boiled to down to this: JLR had a good engineering base and “a very passionate and committed group of people wanting to create new products.

“So if you put it all together, we have a recipe for success,” said the Tata executive cited above. “What else can you ask for? At least there was no doubt in Mr Tata’s mind and my mind that we should go for it with a single-minded focus and we went for it.”

Union backing

One of the early endorsements that Tata Motors got was from the unions, though they gave the firm a grilling.

“We had this meeting (in late 2007) with the union, a very difficult one for three hours. It was eyeball-to-eyeball. Dave (Osborne, Unite’s lead negotiator for the car industry) and Tony (Woodley, Unite joint general secretary) were asking very tough questions. We didn’t have too much hope,” said the Tata executive. “But somewhere in my heart I felt the meeting had gone well. We came out very transparent, sincere, and honest.”

The union leaders told the media after the meeting that their preference was for the Indian company.

While Tata Motors seems to have done all the right things up until now, making the acquisition fit with Tata’s strategy of developing low-cost cars for emerging markets won’t be easy.

“Tata has done a good job in a difficult period,” said Prashant Kale, professor of strategy at the Jones School of Management at the Texas-based Rice University. “But to me, this is more of a standalone turnaround of JLR until now,” said Kale, who works with some Tata group companies

“On the face of it, there seem to be limited operational synergies between JLR and Tata Motors’ remaining passenger car business, given the difference in the primary segments they cater to and the underlying value chain or business models of the two. How Tata Motors is able to leverage those synergies would be interesting.”

Forster is of the view that more than synergy, the group will stress on entrepreneurial spirit.

While Speth says it is time to enjoy the fruit of the investment made in 2007-08, Forster, careful not to appear complacent, says seeds “are being sown to be reaped in 2014.”

Tata Motors plans to pump £800 million-1 billion (Rs. 5,728-7,160 crore) into JLR in the next three-four years for product development, technology upgradation and capital expenditure needs. The UK subsidiary, which contributes two-thirds of Tata Motors’ consolidated revenue, has been generating a cash profit for the last four quarters. In the three months to September, JLR made a cash profit of £351.9 million, up 12% from the year earlier.

With an eye to the future, JLR is setting up manufacturing assembly units in India and China, the markets touted as the fastest growing in the world.

The Freelander, the cheapest of the sports utility vehicles from the Land Rover stable, will start rolling out from the old Tata-Mercedes assembly plant near Pune next year. JLR is also in advanced negotiations to set up a joint venture in China, Speth said, adding that this will allow the company to reduce prices by 35%, making the vehicles more competitive.

“We can rethink our aspirations in China (a market with a size of 17 million cars) through this JV,” Speth said.

Since the Tata Motors acquisition, JLR has been looking at the Bric (Brazil, Russia, India, China) nations with greater interest, he said. These nations account for 31% of sales and the company wants to raise that to 37%. Speth expects China to account for 16% of the company’s total sales over the next few years.