CASE STUDY ANALYSIS ON

GROUP MEMBERS( GROUP 8)(in the order of roll nos.)

• ROHAN GOEL (409)

• JIGNESH KAMANI (417)

• RASIKA LAD (427)

• DWIJ NAIN (435)

• PRAGNA PUJARA (443)

• ABHIJIT SANKHE (451)

• RACHNA SONEJI (459)

The Road Ahead……………

• Phase 1 – Entry into passenger vehicle

• Phase 2 – Launch of Indica

• Phase 3 – Launch of Indica V2

• Phase 4 – New Launches

• Phase 5 – Tata’s Ambitious Project

THE ROAD AHEAD……PAST

• Introduction and History of Tata motors

• PHASE 1

Entry of Tata Motors from

Commercial vehicles

To

Passenger vehicles segment

Automotive Industry

• 50’s -80’s closed market, dominant player being Hindustan Motors Ltd. and Premier Auto Ltd.

• In 1982- Maruti-Suzuki tie up• In 1983- Maruti 800 was introduced• From 83-93, Maruti 800 had monopoly• With 92’s liberalization policy,50% FDI was

allowed.

Automotive Industry (Contd:)• TELCO entered the passenger car market,

introducing three multi-utility vehicles, "Tata Estate" and "Tata Sierra" in 1991-92 and "Tata Sumo" in 1995-96.

• Even after liberalization, Maruti was a dominant player in smaller passenger car segment.

Maruti’s dominance in market:

THE ROAD AHEAD……PAST

• PHASE 2

Entry into the compact Car segment

with Launch of India’s first indigenously developed car

INDICA

INDIA

• India

Satellites into space, but no indigenous car

• TELCO’s initiative

Basic Concepts of new Car

• Space• Easy entry and exit• Safety• Economy of diesel• Price• Contemporary design

TELCO’s low cost, $400 mn Vs.$2 bn Purchase of Nissan plant

PLAYERS IN THE COMPACT SEGMENT

• Maruti Udyog Ltd.

Zen, WagonR

• Hyundai motors India Ltd.

Santro

• Daewoo Motors India Ltd.

Matiz

• Fiat India Automobiles Pvt. Ltd.

Uno

MARKET SHARE Market shares till 1998

Maruti57%Santro

22%

Matiz15%

Uno6% Maruti

Santro

Matiz

Uno

Market shares after Indica launch, Dec. '99

Maruti36%

Santro27%

Matiz12%

Uno7%

Indica18%

Maruti

Santro

Matiz

Uno

Indica

THE ROAD AHEAD……PAST

• PHASE 3

Failure of Indica and Subsequent launch and Success of Tata Indica V2.

INDICA:India’s Car, India’s Pride

• A car exclusively for the middle class Indian.

• A car designed for India rather than a car adapted for India

• More car, per car• Value for money• Pre launch promotions and brand

building exercises“We give you value for your money. Coming

up shortly, so wait for it…”

Sales….

• First Year – 55758 cars

• Cumulative sales for Indica were growing by 37%

• Target Audience – Middle class family man– Young working Executive

• Loyalty Programme – Indica Club

Openness to Problem-Solving

• Tremendous hype because market leader in other products

• Different set of customers with a different set of requirements

• Problems – Uneven tire wear, belt noise

• Rectified the technical glitches

• Extended the warranty period

• Modifications at the production end

Openness to Problem-Solving

• Mid 2000 – More Complications

• Tackled – Improved version launched

• Version – Indica V2

Power &Technology -Indica V2

• Buried the truck building mentality

• “Very soft” or “hard” suspension.

• Deluxe Goods give as standardised features

• Marketing Jargon

Branding The V2

• Only announcements ads

• Highlight the improvements

• Feature Specific

• Titan watches

• Indica club

Branding The V2 ….contd

• Asha Bhosale and Daler Mehndi

• Newsletters

• Dealer panels and Customer meets

• Independent Customer Satisfaction Surveys

• 390 problems per 100 vehicles to 273 problems per 100 vehicles

Changes in Business Policies

• Change in the top management

• Working Capital mgt

• Quality Initiatives for Clear and visible results

Changes in Business Policies

• Gearing up with CRM

• Getting the right systems

• Customer’s Safety First

• Partnering Again

THE ROAD AHEAD……PRESENT

PHASE 4

New Launches

Present Sales Figures– Tata Motors

2005-06 2004-05 Growth

454345(tot inc exports )

399566 13.7%

56406 (march –cumulative)

44432 27%

6508 (exports) 3964 64.2%

22609 (PV --march)

20000 13.1%

Present Sales Figures– Automotive Industry

•12 percent growth overall

•31.55 percent growth in exports

New Launches—Tata Novus

New launches– Tata Safari DiCOR

New Launches – Tata Ace

CHANGES IN TATA OUTLOOK

• Focus on the youth

• Car changed to make it more zippy with good mileage

• More focus on CRM

• Focus on women consumers

• International look and feel

THE ROAD AHEAD……FUTURE

• PHASE 5

Tata’s 1 Lakh Car

• Ratan Tata’s Statement

"It is my dream to make the car a reality within the five years I remain as Tata chairman."

PORTER ANALYSIS

PORTER ANALYSIS

• New entrants : Bajaj ,TVS Motors

• Substitutes – quadricycles

• Competitors – Skoda, Maruti, Hyundai,GM,Reva

• Distributors – New Distribution network

• Suppliers – Supply chain

PROPOSED MODEL

Car Features

• Car bigger than Maruti 800

• Engine lighter

• 5 seat, rear engine vehicle

• Positioned between two wheeler and Maruti 800

• Targeting the two wheeler segment, with a small pie from Maruti 800

Proposed Innovations

• Bolted or glued panels instead of welded bodies

• Small satellite units instead of Dealers

Changes in Business Policy

• At present , adopt technology, develop a product and then improve upon it

• 1 lakh car will be a System, in which Tata will be a systems integrator. Tata will develop the System and co – manufacture the Product.

Changes in Business Policy…

• At Present, Tata manufactures a product and the pricing is then set accordingly

• Now, the price for the car as well as all its components being fixed, the manufacturing is then looked upon

Change in TATA Outlook

• Tie up with local manufacturers

• Rural training – rural employment

• Focus on two wheeler segment buyers

• Car design, technology outsourced

Plant Location to minimize costs

• Plant location – West Bengal

• Tata Steel and Tata Metaliks also in WB

• Plant Location – Jamshedpur

• Good auto components base, Tata HCV and LCV manufacturing base present

• Plant location – Uttaranchal

• Site for hugely successful ACE, offers significant excise relief

Competitor responses to the 1 lakh car

• Maruti – Mr. Khattar – not possible to sell at the quoted price

• Maruti 800 sales rebound this March

• Flank 800 against 1 lakh car with price cut+ cut in excise duty

• Hyundai– will compromise on safety, emission norms etc

• Bajaj – we can make better car

Thank You

Any Questions ???

Any Questions ???