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Nissan exit shouldn’t affect ALL Daimler grows sales and share in India L & T set bigger ambitions in defence business A welcome initiative-even critics are recognised Tata Motors bets on new launches L&T bags the Mumbai Trans-harbour link order L&T profit up by 11 per cent AL secures orders for 3600 buses AL introduces Guru & Partner TI Cycles plans retail expansion to drive sales for premium bicycles Michelin to double Chennai capacity Sundram Fasteners rejigs international Hyundai to focus on SUVs and AMT variants Ode to Ratan Tata Ponni Sugars (Erode) Ltd: not so sweet 2012-13 Daimler’s truck exports from Chennai cross 5000 units Gamesa to set up a plant in Nellore Rane targets Rs.5500 crore topline by 2018-19 Toyota and Suzuki to introduce EVs in India by 2020 Aurobindo Pharmacy: good turnaround A niche in FMCG business... Preparing for the next growth curve Titan Company – sales recovery to kick in Solar installations exceed 2015 capacity in five months Hindalco – re-rating PPP model for infrastructure development Right to privacy – now it’s fundamental! TVS Srichakra plans capacity expansion Singur minus Nano – victory or folly? Is this a generation gap? ITC – steep excise hike Kone India eyes further growth in elevator market When small is not so beautiful… Welcome focus to improve rural India... Chinese smart phones flourish in small towns too! Housing demand revival Eyes strong growth in 2016-17 Tata gets 4-star rating for Zest Shriram Life clocks more than Rs.1000 crore premium in 2015-16 Are they really independent? PSU non-life firms seek to protect share V-Guard launches app-enabled water heater system Consolidating leadership position in smartphones Maruti – for young buyers Tata Steel, ThyssenKrupp sign MoU to merge European units L & T’s floating dock for navy It takes two to tango The unexpected exit TN government keen on revival of operations at Nokia complex Carnival Films acquiring 3000 screens pan India Sivasankaran enters taxi space to take on Uber and Ola Forging industry worried over lower supply of steel and its price E.I.D Parry (India) Ltd: another sweet year Mercedes-Benz sales continue to zoom Land wars Increasing market share Tata Motors joins compact SUV bandwagon with Nexon Record two-wheeler sales Emami – a new growth mantra TVS Automobile invests Rs.75 crore in start-up firms HPCL plans Rs.61,000 crore capex over 5-years Smooth sailing of SAIL Last stages Bajaj Finserv – Q1: fare well ITC chairman calls for policy impetus to transform agriculture Yamaha unveils scooter boutique Back in growth mode CAPITAL NOTES Wabco launches safety system RoC in the dock... Smartphone onslaught by Chinese brands 29 per cent jump in TCS revenues From the toughest to the best year Vellayan is back, after 150 days IOB on turnaround path Hyundai India achieves 7 mn production at Chennai factory New India Assurance posts impressive show LVB posts 31 per cent growth in Q1 net profit Tata Motors charts investments in PV and CV businesses Tata Motors aims to be among the Top 3 global CV & PV firm M & M unveils driverless technology for tractors AL wins Deming prize again Dish TV – subscriber additions encouraging He excels in the nuts and bolts of entrepreneurship The gainers and the losers
 
When small is not so beautiful…

Over the last four years, the sale of passenger cars by Tata Motors has fallen by more than half from around 3.7 lakh to 1.5 lakh. The great enthusiasm with which Ratan Tata expanded the car business seems to have waned. In his tenure as Chairman, Tatas acquired the British Land Rover and the Daewoo truck businesses. In quick succession, Tata Motors launched the Indica and the Tata Magic which were well received. For a few years, the sales of the Indica zoomed; it became quite popular among taxi operators. The Nano, launched with great expectations, as the Small Wonder  (borrowed from the famous VW Beetle) did not fare well. Impressed by the passion and imagination with which the Nano was launched at the Auto Expo, I ordered for two, each costing on the road around Rs. 2.15 lakh. Air conditioning was effective as also were the power windows limited to the front seats. But the absence of power steering made one feel like  driving a truck. Repair costs were high; combined with poor resale value, Nano lost its popular appeal.

Renault’s Carlos Ghosn built his Kwid on Ratan Tata’s Nano experience. The care bestowed in designing it through the combined efforts of Europe, South Korea and India, the focus on very high indigenisation (98 per cent even at the launch), tight costing and the electrifying launch contributed to the quick success of the Kwid.  This small car received a good response, with an estimated 100,000 cars booked during the first year.


Legacy issues...

Guenter Butschek, who has taken charge as MD and CEO of Tata Motors, pointed to legacy issues as among the reasons for the steep decline in interest in Tata cars. Butschek brings with him rich experience, having worked earlier with the German giant Daimler.  He headed the company’s operations in China and also worked for Airbus Industrie. His experience in contributing to the spectacular growth of the Chinese auto industry should help Tata Motors arrest its decline and revert to its earlier era of high growth in the passenger car segment.  Competition is acute from global auto leaders, notably Maruti-Suzuki, Hyundai, Toyota and Renault-Nissan. Add to these the technological prowess of Volkswagen, Ford and GM and the going would indeed be tough.

Looking back, Tata Motors could have acquired Daewoo’s Matiz facility in Noida that had better design and performance. The company could also have focused on an electric car that would help it leapfrog technology. Competing on traditional lines in the highly evolved passenger car segment is not going to be easy.  In our previous edition, we referred to the Tata Group under Cyrus Mistry re-looking at its different businesses, as did Ratan Tata in the early 1990s and deciding which sectors to focus on and excel in. Will these include passenger cars?

 

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