Tata Motors looks to rationalise product portfolio
17 October 2012
India's largest auto company, Tata Motors has plans to rationalise its product portfolio and refurbish its presence in the domestic and global auto markets. According to the head of the company's Indian division, Karl Slym, the car maker planned introduce a new generation version of its iconic model Nano in US auto market within a span of around three years.
Tata Motors was dependent on its British luxury car division Jaguar Land Rover, which was helping it to offset the losses incurred in the Indian auto industry. Also the new profit of the company had declined in three straight quarters, and the reason cited for this fall was that the auto maker had not introduced a new mass market model in the last couple of years, which had significantly reduced its hold over the Indian market.
Under the company's strategy, it has launched a new generation model Safari Storme Sports Utility Vehicle, which was expected to strike right chords with the hearts of Indian buyers.
At the launch press conference Slym said, ''We will continue to look for segments where there is growth, and there's a likely pruning that will happen over time as we do that with our portfolio. The foundations and the capabilities of an organisation that can do much better than what you've seen in the results are there.''
In first quarter of this fiscal, the company posted a 9.9 per cent decline even as the market witnessed an overall surge of 5.2 per cent. The profits of Tata's Indian business fell 31 per cent in the last fiscal and stood at less than 10 per cent of its consolidated profit, which stood at Rs135.17 billion.
According to industry experts, the largest bus and truck maker of the country was witnessing stiff competition from the overseas companies, including American auto maker Ford and German Volkswagen, as they had kicked off their operations locally.
Meanwhile, Slym, who earlier headed General Motors Co's operations in the country, said in an interview that he wanted to make Tata Motors more customer-centric and review the segments that the car maker wanted to get into.
Live Mint quoted Slym as saying Tata Motors did not need a revival. In commercial vehicles sales, the company had a very broad and strong portfolio Slym said, adding, that there was new competition coming into the area which was an opportunity for the automaker.
He also said in September the company had the highest commercial vehicle market share in 18 months at 62 per cent.