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History Of Tata Motors :

Tata Motors is Indias largest automobile company, with consolidated revenues of USD 20 billion in 2009-10. It is the leader incommercial 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. Established in 1945, when the company began manufacturing locomotives, the company manufactured its first commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969.[3] 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 a 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 andPune in India, as well as in Argentina, South Africa and Thailand.

Acquisitions

In 2004 Tata Motors acquired Daewoo's truck manufacturing unit, now known as Tata Daewoo Commercial Vehicle, in South Korea. In 2005, Tata Motors acquired 21% of Aragonese Hispano Carrocera giving it controlling rights of the company. In 2007, Formed a joint venture with Marcopolo of Brazil and introduced low-floor buses in the Indian Market. In 2008, Tata Motors acquired British Jaguar Land Rover (JLR), which includes the Daimler and Lanchester brand names. In 2010, Tata Motors acquired 80% stake in Italy-based design and engineering company Trilix for a consideration of 1.85 million. The acquisition is in line with the companys objective to enhance its styling/design capabilities to global standards.

Expansion:

The FIRST generation Tata Indica V2's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger vehicle market in 1991 by launching theTata Sierra, a multi utility vehicle. After the launch of three more vehicles, Tata Estate (1992, a stationwagon design based on the earlier 'TataMobile' (1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998, India's first sports utility vehicle). Tata launched the Indica in 1998, the first fully indigenous passenger car of India. Though the car was initially panned by auto-analysts, the car's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of

the best selling cars in the history of the Indian automobile industry. A newer version of the car, named Indica V2, was a major improvement over the previous version and quickly became a mass-favourite. Tata Motors also successfully exported large quantities of the car to South Africa.The success of Indica in many ways marked the rise of Tata Motors.

Tata Motors in India

Tata Motors Limited is Indias largest automobile company, with revenues of 35,651.48 crore (US$ 8.09 billion) in 2007-08.[28] It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles in India with products in the compact, midsize car and utility vehicle segments.[28] Tata vehicles are sold primarily in India, and over 4 million Tata vehicles have been produced domestically since the first Tata vehicle was assembled in 1954. The companys manufacturing base in India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, Tata set up an industrial joint venture with Fiat Group Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains. The company is establishing a new plant at Sanand (Gujarat). Tata's dealership, sales, service and spare parts network comprises over 3500 touch points. Tata Motors also distributes and markets Fiat branded cars in India

Electric vehicles:

Tata Motors unveiled the electric versions of passenger car Tata Indica and commercial vehicle Tata Ace. Both run on lithium batteries. The company has indicated that the electric Indica would be launched locally in India in about 2010, without disclosing the price. The vehicle would be launched in Norway in 2009.[24] Tata Motors' UK subsidiary, Tata Motors European Technical Centre, has bought a 50.3% holding in electric vehicle technology firm Miljbil Grenland/Innovasjon of Norway for US$1.93 M, which specialises in the development of innovative solutions for electric vehicles, and plans to launch the electric Indica hatchback in Europe next year.[25][26][27] On 17 Sept 2010 Tata motors presented to the DTC [ Delhi

Transport corporation] Four CNG - Electric Hybrid lowfloored Starbuses to be used for commonwealth games. These will be the first Environmentally friendly buses to be used for public transportation in India.

Tata Ace :

Tata Ace, India's first indigenously developed sub-one ton mini-truck, was launched in May 2005. The mini-truck was a huge success in India with auto-analysts claiming that Ace had changed the dynamics of the light commercial vehicle (LCV) market in the country by creating a new market segment termed the small commercial vehicle (SCV) segment. Ace rapidly emerged as the first choice for transporters and single truck owners for city and rural transport. By October 2005, LCV sales of Tata Motors had grown by 36.6 percent to 28,537 units due to the rising demand for Ace. The Ace was built with a load body produced by Autoline Industries.[18] By 2005, Autoline was producing 300 load bodies per day for Tata Motors. Tata Ace - Apka Pyaara Chota Hathi. Ace is still a top seller for TML with 5M units sold to date (June 2010).[19] Ace has also been exported to several European, South American and African countries and all-electric models are sold through Chrysler'sGlobal Electric Motorcars division

Tata Nano:

In January 2008, Tata Motors launched Tata Nano, the least expensive production car in the world at about 120,000 (US $3000).[16] The city car was unveiled during the Auto Expo 2008 exhibition in Pragati Maidan, New Delhi . Tata has faced controversy over developing the Nano as some environmentalists are concerned that the launch of such a low-priced car could lead to mass

motorization in India with adverse effects on pollution and global warming. Tata has set up a factory in Sanand, Gujarat and the first Nanos are to roll out summer 2009. Tata Nano Europa has been developed for sale in developed economies and is to hit markets in 2010 while the normal Nano should hit markets in South Africa, Kenya and countries in Asia and Africa by late 2009. A battery version is also planned.

Tata Safari DiCOR

The SUV was first released in 1998 with a 2.0 litre Turbo Diesel engine. The Safari was extensively modified in August 2005, which included the addition of a new 3-litre DiCOR engine along with modified interiors and exteriors. This 3-litre engine is the first diesel engine from Tata Motors with common rail technology. A 2litre petrol engine was also added to the range that same year. It was this modified version that won the Motor Forum's Car of the Year for 2007, in the SUV category. Voted by the users, it beat out rivals such as the Toyota RAV4, Land Rover Freelander and Honda CR-V. In October 2007 Tata unveiled the 2.2-litre Safari DiCOR which had an increased power output of 143 PS (105 KW). But it was shortly replaced by the more advanced DiCOR 2.2 VTT (Variable Turbine Technology) engine which had a power output of 140 PS (103 kW) at 4000 rpm and a torque output of 320 Nm (236 ftlbf) at 1700 rpm. It is widely regarded as the best engine used by Tata Motors[citation needed]. Tata recently launched a new variant of safari called Safari GX. The new Safari GX sits just below current top end variant Safari VX. Safari Gx gets dual tone exteriors, unique leather cum fabric upholstery, Reverse Guide System (without a camera which along with the Screen in the Internal Rearview Mirror is only available in the VX variant). Another new feature is indicators on the Outer Rear View Mirrors.

The market of Tatas entry in UK

Despite the global tendency for the significant fall of car sales there are certain car segments which experience dynamic growth. According to Datamonitor (2006b) the sales of commercial vehicles and port utility vehicles were very healthy. Windecker (2005) stresses the influence of socio-cultural forces which formed the increased preferences towards more fashionable, sport-type, SUV equipped cars. The extremely high growth of SUVs was identified in US and UK. The focus of Tatas market entry will be UK. There were several reasons for selecting UK as the target market. These favourable factors were the status of India as the favourable economic agent, UK Car market dynamics and potential, language similarity. The other countries which were considered as potentially attractive were: the USA the largest market size in the world, Russia emerging market with significant sales potential. The option of the USA as target market was declined due to extremely high quality requirements and other non-tariff barriers which make it hard for a new entrant to enter this market. Besides, this market is highly mature and experiences extreme level of competitive pressure. With regards to Russia, there were several unfavourable factors which made it less attractive then the UK the uncertainty of the further economic state, high entry barriers and no well developed dealership network.

Analysis of External Environment of the UK market

There are numerous number of factors that might be included into P.E.S.T. analysis. But due to various limitations (time, word limit), the factors will be outlined, whereas the major focus will be made on several sub-factors only (according to the Pareto Principle, it is likely that about 20% of the factors will represent 80% of the potential effect on the business (Wit & Meyer, 1998).

Political factors

Political and legal factors play the role on the development of the industry. These factors shape the rules of competition, operational costs and supply chain requirements. Oil prices resulting from international instability The special attention shall be given to oil prices and its affect on the market requirement. According to Mintel (2006) the increase of oil prices has created a strong tendency towards small engines, hybrid engines and diesel engines. Current high level of oil price increase the strain on the sales of luxury and premium cars, the majority of which are equipped with large-size engines (more then two litres). Administrative barriers (quality controls and operations requirements) (KPMG, 2004) Administrative barriers need to be seriously concerned as various requirements for safety standards and emission level might increase the costs of production and reduce the operating profit margin. Car parc legislation According to Mintel (2006) the UK experience the threat of high overcapacity with the excessive traffic load of road networks. The political relationships between countries of operations (regimes of favourability/protectionism) (Hill, 2002) India cooperates with the UK within the regime of favourability which implies the certain benefits as reduced tariff and nontariff barriers. The foreign ownership regulations (The market expansion mode (Hill, 2002) At the present time the UK is considered as one of the most pro-FDI country in EU. The large number of industries, including automotive one, are deregulated. It means

that foreign regulation provides foreign companies with flexibility of choosing between all possible entry and expansion modes.

Economic factors

One of the major location choice determinants is the current and future demand conditions as they will affect the market growth potential, pricing strategy and operations margin and the potential of the return on investment. The target market size According to Mintel (2006) since 2001 there has been a steady market growth by size and value. The current UK car parc is estimated to accommodate 31 million units. The market value was contributed by the steady growth of average price level. The present market value is estimated to reach the level of 31 billion The maturity of the target market The UK market is viewed (Mintel, 2006) as highly mature. The current maturity causes overcapacity issue and significant sales fall of particular car segments. The growth potential of the target market The overall UK market experiences negative growth due to the maturity issue. Nevertheless, certain the sales of certain car segments have significant growth potential due to the impact of socio-cultural and technological factors. PDI According to Mintel (2006) the strong growth of GDP (10% between 19982005), personal disposable income (PDI) (19%) and consumer expenditures (18%) reflect the high level of consumer confidence. Mintel (2006) claims that in terms of the purchase of new cars consumer confidence has significantly fallen. By the present moment UK consumers have been reluctant to take out new debt and instead are choosing to service their existing debt. Additionally the levels of mortgage equity withdrawal have declined, what indicates that UK consumers do not seek alternative funds to buy expensive items like cars. Currency stability The current strong state of British pound against other currencies have created various benefits for manufacturers consumers operating in pound zone such as predictability of operations and minimised currency fluctuation risk . Labour costs As the outlook of the automotive industry highlighted, the cost factor and the capability of direct and indirect costs becomes one of the key issues in maintaining competitive advantage. According to the opinion of the industry specialists (KPMG, 2004), one of the key issues that will influence the operations location decision will be labour-specific costs. According to survey (KPMG, 2004)

industry specialists put a major emphasis on the labour-specific cost saving. Moreover, 85 % of the respondents agreed that during coming five years there will be a major increase of labour specific costs (cost of pensions, health care, and legal services) in US and EU . The expansion of existing political and economic blocs (EU) The importance of the recent further expansion of EU is in the enlargement of the EU as single market. In case of successful expansion on the UK market, Tata might consider the further expansion in certain EU countries. According to estimations of Nieuwenhuis & Wells (2003) the attractiveness of EU as the target market for a car manufacturer will remain high. They claim that the attractiveness of EU as a target market will be maintained by the increase of its market size and value as the outcome of the extension of EU zone. However the current maturity of the market, excessive completion and demand trend suggests that the share of Europe will drop.

Social factors

Demographic factors Demographic factor is one of the key social factors. It affects lifestyle, consumer trends, the type of risk aversive behaviour, spending power and value per customer. The state of demographic trends allows building projections for the use of particular type of products. The current UK demographics have undermined the sales of family cars Lifestyles The change of lifestyles and habits have a direct impact on the consumer expenditures. For instance, Mintel (2006) points out the recent increase of preferences for second car ownership. Mintel (2006) adds that the impact of lifestyle factors such as fashionability and luxury preferences are so strong that it removes the negative effect of market maturity and oil prices in certain car segments. Thus, against all odds, SUVs and luxury cars experience healthy growth, whereas the sales in other car segments have fallen dramatically.

Technological factors

The development of information technologies The current development of Internet opens new transactional capabilities. Currimbhoy (2004) suggests that continuous development of technological solutions, especially in the area of digital and communication technologies create new operating opportunities such as new marketing mix channels, new purchase environment (e-commerce) and new market research tools. According to Mintel (2006) the number of leading car distributors develop e-commerce to counter the problem of overcapacity. The impact of new technologies on supply chain architecture The development of e-exchange channels between supply chain agents becomes the source of strategic advantage (Currimbhoy, 2004) as it creates the ability of fast market response and better value chain quality control.

The review of micro factors affecting UK car business

Competitors bargaining power

The UK automotive market is highly consolidated. The major rivalry involves Ford, GM (Vauxhall), VW, Renault, Peugeot, Toyota, BMW, Citroen and Honda. The presence of powerful competitors with established brands create a threat of intense price wars and poses s strong requirement for product differentiation. According to Mintel (2006) the tough competitive pressure require increasing promotional costs, overcapacity introduces a significant price pressure. The present market conditions are so tough, that certain manufacturers had to close certain plants to cut the costs and survive on the market. At the moment, the major competitive strategies are supply chain improvement, new product development and serving the needs of emerging market segments (Mintel, 2006). The emerging opportunities requires the extremely high level of

operational responsiveness and leaves little space till market opportunity will be leveraged by competitors.

Buyers bargaining power

Due to high intensity of competition on the global scale and increasing overcapacity issue UK buyers experience very strong bargaining power. According to Mintel (2006) buyers have indicated a high level of bargain-seeking behaviour.

Suppliers bargaining power

Though vehicle manufactures have consolidated forming large entities it did not make a significant shift of bargaining power in OEM-suppliers relations. According to Veloso & Kumar (2002) the consolidation in the OEM sector has triggered the corresponding consolidation of different supplier groups. Demand chain partners, car dealers, especially the large ones do experience large bargaining power in the light of the overcapacity issue.

The threat of Substitutes:

Apart from direct competitors (public transport) cars compete with other transport services: air, rail and sea. The increasing importance of door-to-door transportation and environmental concerns decrease the current threat of other transportation means as substitutes. One of the major sources of substitute threat comes from the sales of second-hand cars. According to Mintel (2006) the steady accumulation of second-hand cars has become on of the major reasons of the dramatic fall of the sales of new cars.

Threat of New entrants:

The high level of entry barriers (extremely consolidated industry, well-developed value-added chain, R&D capability, investment capability in promotions and new product development) minimises the threat of new entrants. Nevertheless, due to globalised nature of the industry the notion of new entrant is not that clear-cut, since existing players might enter new geographical markets. Datamonitor (2006) stresses the future potential of Chinese manufacturers to flood EU markets in case protectionist measures are not introduced by EU countries

Acquisition Jaguar Cars and Land Rover

After the acquisition of the British Jaguar Land Rover (JLR) business, which also includes the Daimler, Lanchester and Rover brands,[14] Tata Motors became a major player in the international automobile market. On 27 March 2008, Tata Motors reached an agreement with Ford to purchase their Jaguar Land Rover operations for US$2.3 billion. The sale was completed on 2 June 2008.[10] In addition to the brands, Tata Motors has also gained access to two design centres and two plants in UK. The key acquisition would be of the intellectual property rights related to the technologies.

Joint ventures

Tata Motors has formed a 51:49 joint venture in bus body building with Marcopolo of Brazil. This joint venture is to manufacture and assemble fully-built buses and coaches targeted at developing mass rapid transportation systems. The joint venture will absorb technology and expertise in chassis and aggregates from Tata Motors, and Marcopolo will provide know-how in processes and systems for bodybuilding and bus body design. Tata and Marcopolo have launched a low-floor city bus which is widely used by Chennai, Delhi, Mumbai, Lucknow and Banglore transport corporations. It's manufacturing facility is based in Dharwad. Tata Motors also formed a joint venture with Fiat and gained access to Fiats diesel engine technology.[15] Tata Motors sells Fiat cars in India through a 50/50 joint venture Fiat Automobiles India Limited, and is looking to extend its relationship with Fiat and Iveco to other segments. Tata has also formed several JV's with many small companies in various countries around the world.

Marketing strategies of Tata motors

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 ones product.

Marketing Mix:

Product Brand Packaging Innovations

PRICE Pricing Strategy Pricing & Quality Price & Alterations

PROMOTION Personal Selling Advertising Public Relations

PLACE Channels of Distributions Physical Distribution Wholesaler &Retailers

PRODUCT (Brand, Packaging, Innovations, Quality) :

Brand : Advertising is often used to make consumers aware of a products 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. 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. 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. 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.

PRICE (Pricing Strategy, Alterations, Discounts)

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

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. 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. 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. 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

PLACE (Channels of Distribution, Physical Distribution)

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.

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

Tata Motors Success Mantra

Tata Motors is India's largest company in the commercial vehicle sector. The company is the worlds fourth largest truck manufacturer and second largest bus manufacturer in the world. In India, Tata Motors is the leader in every commercial vehicle segment and it is the third largest passenger car maker. Tata Motors is able to produce more than 4 million different types of vehicles such as cars, trucks, commercial vehicles, SUVs and many more since the company began in 1945. The marketing strategy of Tata Motors is one of the most successful marketing strategies used by a car maker in the car industry. The car company lays emphasis on the Product Branding and Advertising. Advertising is the common way to make public aware of the new product. Besides, advertising also help to create a brand image. Over the years, Tata Motors have been successful in their own might in creating a brand image for itself. Tata Motors also stresses on the packaging, innovations and quality control of a product. Tata Motors is being able to provide many innovative features to lure customers. E.g., the Tata Safari 4X4 Dicor with its Reverse Guide System, where a weather-proof camera is fixed to the rear end of the car to help the driver while reversing the car. The pricing policy of Tata Motors is always appreciated by the public. The price of a car can be determined by factors such as market condition, cost incurred to build a car, profit by company and dealer profit. Tata Motors makes use of strategies such as discount and special promotions every now and then. This attracts car lovers to opt for a Tata car. Tata Motors gives discounts based the companys profit or from dealers profit at a certain range. Tata Motors has felt its presence across India and abroad with its showrooms. This is another marketing strategy of Tata Motors that boosts sales of vehicles. The car company has established many servicing centres as well which stands as a back bone for the company to connect with the people. Tata Motors easy access to the general public has made the brand grow in size and stature. Tata, due to its presence in the commercial as well as the passenger vehicle segment, know the pulse of the people unlike many other car makers. Tata which is a huge conglomerate has branched its business into various segments like finance, banking, public sectors domains and other major fields apart from automobiles which has made Tata a household name in India and abroad.

SWOT Analysis - Tata Motors Limited

The company began in 1945 and has produced more than 4 million vehicles. Tata Motors Limited is the largest car producer in India. It manufactures commercial and passenger vehicles, and employs in excess of 23,000 people. This SWOT analysis is about Tata Motors.

Strengths

The internationalisation 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 recognised 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 gasguzzlers, 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 globalises 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.