SUBMITTED BY: ARCHANA GOYAL HINA GOEL KANIKA ARORA KAVITA MEENA RICHA MISHRA SURBHI RAJPOOT SWETA

SINHA

The automobile sector in India was severely impacted by the disruption in the Indian and global business environment. Gross Domestic Product growth slowed down considerably from 9% in FY 07-08 to 6.7% in FY 0809. While the slowdown in the Indian economy was less compared to other world economies, it did have a severe impact on most sectors. Both turnover and profitability of the automotive sector came under tremendous pressure. Double digit inflation and high material cost in the first half of the year leading to higher vehicle prices, higher fuel prices, unavailability of finance, higher cost of financing and uncertainty in the overall economic conditions impacted demand to a great extent. The slowdown in the economy resulted in a drop in industrial production, which reached new lows in the second half of the year. All these factors eroded the bottom line of the companies in the automotive sector.

Both the commercial and passenger domestic vehicles industry came under tremendous pressure as a result of these market conditions. The commercial vehicle industry which had already started showing signs of slowing down last year, declined by 17.4% compared to the 7.6% growth in FY 07- 08. The passenger vehicle industry, which had showed a growth of 11.3% in the previous fiscal, went into negative zone with a decline of 0.5%. Supported by stimulus measures undertaken by the government and the RBI, demand showed some signs of revival towards the end of the year.

In such trying times, the companys sales of 506,421 vehicles were 13.5% lower than last year volumes. Even though domestic commercial vehicles volumes declined by 15.2%,the company consolidated its leadership position in the domestic market by introducing new products to complement its existing product portfolio. The passenger vehicles volumes declined by 4.8% in the domestic market, primarily due to the phasing in of the new Indica Vista in the second half of the year and sluggishness of the UV segment. The companys exports declined by 38.6% during the year, due to the meltdown in major international markets and the consequent swings in foreign exchange rates.

Tata Motors has two business units the Passenger Car Business Unit (PCBU) and Commercial Vehicles Business Unit (CVBU). The vision and mission of both the business units are given below:
PASSENGER CAR BUSINESS UNIT

VISION To develop TATA into a world class car brand for innovative and superior value vehicles. MISSION To be the most admired multi-national Indian car company producing vehicles that people love to buy. To create an organization that people enjoy working for, doing business with and investing in

COMMERCIAL VEHICLE BUSINESS UNIT-Journey To Excellence

VISION To be a world class corporate constantly furthering the interest of all its stakeholders.

MISSION SHAREHOLDERS To consistently create shareholder value by generating returns in excess of Weighted Average Cost of Capital (WACC) during the upturn and at least equal to Weighted Average Cost of Capital (WACC) during the downturn of the business cycle. CUSTOMERS To strengthen the TATA brand and create lasting relationships with the customers by working closely with business partners to provide superior value for money over the lifecycle.

Tata Motors is Indias largest automobile company. It is the leader by far in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. The company is the worlds fourth largest truck manufacturer and the second largest bus manufacturer. Established in 1945, Tata Motors presence indeed cuts across the length and breadth of India. Over 4 million Tata vehicles ply on Indian roads, since the first rolled out in 1954.

.The companys manufacturing base is spread across Jamshedpur, Pune, Lucknow andPantnagar (Uttarakhand). Following a strategic alliance with the Fiat Group in 2005, it has set up an industrial joint venture with Fiat India Automobiles Pvt. Ltd. At Ranjangaon(Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains establishing two new plants at Dharwad (Karnataka) and Sanand (Gujarat). Thecompanys dealership, sales, services and spare parts network comprises over 3500 touchAt the core of the companys approach to doing business is the Tata Business Excellence Model. Incorporating sound business principles, like customer satisfaction, quality,attention to detail, conservation of resources and protection of the environment, thismodel shapes the way Tata Motors designs, manufactures and markets its products points.

The companys 24,165 employees are guided by the unwavering commitment to be best in the manner in which we operate, best in the products we deliver, and best in our value system and ethics. Tata Motors helps its employees realise their potential through innovative HR practices. The companys goal is to empower and provide employees with dynamic career paths in congruence with corporate objectives. All-round potential development and performance improvement is ensured by regular in-house and external training. The company has won several awards recognising its training programmes.

Passenger Cars: The range comprises the Tata Indica (compact car), the Tata Indigo(sedan), the Tata Indigo Marina (station-wagon), the Tata Nano (small car). Thecompany also distributes and markets Fiat Utility Vehicles: A range comprising the Tata Aria (Crossover); the Tata Safari (SUV), theTata Xenon XT (Lifestyle Pick-up), and the Tata Sumo Grande MK II, the Tata Sumo rangeand the Tata Venture (People Carriers).branded cars in India. Commercial Vehicles for goods transportation Small Commercial Vehicles: the Tata Ace, Indias first indigenous mini-truck. Light Commercial Vehicles: Pick-ups and trucks ranging from 2T GVW to 7.5TGVW. Medium and Heavy Commercial Vehicles: Tata Prima range of world standardmulti-axle trucks, tractor-trailers, tippers, mixers, and special applicationvehicles, ranging from 10T GVW to 75T GVW.

Commercial Vehicles for passenger transportation Tata and Tata Marcopolo range of light, medium and heavy buses from 2T GVWonwards. Multi-purpose vehicles the Tata Magic, the Tata Magic Iris, the Tata Wingerand the Tata Venture for urban and rural transportation.

Through its subsidiaries and associate companies, Tata Motors is engaged in manufacturing and marketing of automobiles, engineering, design 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 auto finance, automotive retailing and service operations. Jaguar Land Rover: the two great British brands, comprising Jaguar luxury saloons & sports cars, and Land Rover 4X4s. Tata Marcopolo Motors: Manufacturing fully-built buses in India. Tata Daewoo: Manufacturing and marketing of medium and heavy commercial vehicles in South Korea. It is South Koreas second largest truck manufacturer, and the largest exporter of heavy trucks. Hispano Carrocera: Manufacturing and marketing of buses.

Tata Motors (Thailand): Manufacture and marketing of pick-up vehicles in Thailand. Telcon: Manufacturing and marketing of construction equipment and allied services. Tata Motors European Technical Centre: Design engineering and development of products. Tata Technologies: Specialised engineering and design services, product lifecycle management, and product-centric IT services. TAL Manufacturing Solutions: Factory automation solutions, machine tools, and 11 aerospace business. HV Transmission and HV Axles: Gear boxes and axles for heavy & medium commercial vehicles. Tata Autocomp: Manufacturing and marketing of auto components, systems, engineering services. TML Distribution Co.: Sales, logistics and distribution of Tata Motors vehicles. Tata Motor Finance: Financing of Tata Motors passenger vehicles and commercial vehicles.

The companys international business includes Jaguar Land Rover, which came into the fold in 2008. Jaguar Cars Limited, founded in 1922, is one of the worlds premier

Tata Motors, the first company from Indias engineering sector to be listed in the New York Stock Exchange (September 2004), has also emerged as an international automotive company. The companys objective is to expand its international business, both through organic and inorganic growth routes. Through subsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand and Spain. The companys international business includes Jaguar Land Rover, which came into the fold in 2008. Jaguar Cars Limited, founded in 1922, is one of the worlds premier manufacturers of luxury saloons and sports cars. Since 1948, Land Rover has been manufacturing authentic 4x4s that define breadth of capability in their segments. The Jaguar range comprises Jaguar XF, XJ and XK and the X-TYPE, while the Land Rover range comprises Range Rover, Range Rover Sport, Defender, FreeLancer 2 and Discovery 3. The Jaguar Land Rover business employs some 16,000 people, predominantly in the UK,including some 3,500 engineers at two product development centres in Whitley, Coventry and Gaydon, Warwickshire. The business is a major wealth generator for the UK with 78 per cent of Land Rovers exported to 169 countries, and 70 per cent of Jaguars exported to 63 countries, with sales to customers conducted principally through franchised dealers and importers.

In 2004, Tata Motors acquired the Daewoo Commercial Vehicle Company, South Koreas second largest truck maker. The rechristened Tata Daewoo Commercial Vehicle 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, and subsequently the remaining stake in 2009. Hispanos presence is being expanded in other markets. In 2006, it formed a joint venture with the Brazil based Marco polo, 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 companys pickup vehicles in Thailand; the Tata Xenon was launched in Thailand in 2008. These linkages will further extend Tata Motors international footprint, established through exports since 1961. The company's commercial and passenger vehicles are already being marketed in several countries in Europe, Africa, Middle East, South East Asia, South Asia and South America. It has franchisee/joint venture assembly operations in Malaysia, Kenya, Bangladesh, Ukraine, Russia and Senegal.

The foundation of the companys growth is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customerdesired offerings through leading edge R&D. The R&D establishment includes a team of over 3,000 scientists and engineers and comprehensive in-house facilities, including crash-test, 13environment test for extreme heat and cold, and noise and vibration test. The companys Engineering Research Centre (ERC) was established in 1966, and has facilitiesin Pune, Jamshedpur, Lucknow and Dharwad. 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. All these facilities together enable the company to share and access knowledge and technology for designing and developing world-class products.The ERC has enabled pioneering technologies and products. It was Tata Motors, which developed the first indigenously developed Light Commercial Vehicle, Indias first Sports Utility Vehicle and, in 1998, the Tata Indica, Indias first fully indigenous passenger car. Within two years of launch, Tata Indica became Indias largest selling car in its segment.

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 by launching the Tata Ace, Indias first mini-truck, in 2005. The Ace platform has also helped spawn the innovative Magic range of people carriers for public transportation. In January 2008, Tata Motors unveiled its Peoples Car, the Tata Nano, which India and the world have been looking forward to. A development, which signifies a first for the global automobile industry, the Nano brings the comfort and safety of a car within the reach of thousands of families. The car is available in both standard and deluxe versions. The standard version has been priced at Rs. 100,000 (excluding VAT and transportation cost).Tata Motors is equally focussed on environment-friendly technologies in emissions and alternative fuels. It has also been implementing several environment-friendly technologies in manufacturing processes, significantly enhancing resource conservation. The ERC 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.

Name of Committee Audit Committee

Role The Audit Committee functions according to its Charter that defines its powers, scope and role in accordance with the Companies Act, 1956, listing requirements and US regulations applicable to the Company and is reviewed from time to time. Whilst, the full Charter is available on Companys website www.tatamotors.com The Remuneration Committee of the Company is empowered to review the remuneration of the Managing Director and the Executive Director, retirement benefits to be paid to them under the Retirement Benefit Guidelines approved by the Board and deal with matters pertaining to Employees Stock Option Scheme

Remuneration Committee

Investors Grievance Committee

The Investors Grievance Committee of the Board is empowered to oversee the redressal of investors complaints pertaining to share/debenture transfers, non-receipt of annual reports, interest/dividend payments, issue of duplicate certificates, transmission (with and without legal representation) of shares and debentures and other miscellaneous complaints The Ethics and Compliance Committee was constituted to formulate policies relating to the implementation of the Tata Code of Conduct for Prevention of Insider Trading (the Code), take on record the monthly reports on dealings in securities by the Specified Persons and decide penal action in respect of violations of the applicable regulations/the Code

Ethics & Compliance Committee

Executive Committee of Board

The Executive Committee of Board reviews capital and revenue budgets, long-term business strategies and plans, the organizational structure of the Company, real estate and investment transactions, allotment of shares and/or debentures, borrowing and other routine matters. The Committee also discusses the matters pertaining to legal cases, acquisitions and divestment, new business forays and donations The Nominations Committee of the Board was constituted with the objective of identifying independent directors to be inducted on the Board and to take steps to refresh the constitution of the Board from time to time

Nominations Committee of the Board

The Tata Group has always been values driven. The five core values of Integrity Understanding, Excellence, Unity and Responsibility drive the way we run our businesses. The Tata Code of Conduct (Tcoc) which is the ethical road map for the Tata Group is a derivative of the core values. Tata Motors employees, channel partners, including suppliers and dealers are all bound by the Tata Code of Conduct (Tcoc), through which the company adheres to a strict policy against any corrupt practices. The policy on gifts and donations is also enforced.

As an employee at Tata Motors, it is obligatory to not only adhere to the code but also to be concerned if there is an actual or possible violation of any clause and to bring it to the attention of the Ethics Counsellor. TCoC is prominently displayed at our establishments and is available in English and vernacular languages at the companys internal website. Moreover, all current and new employees undergo training on TCoC and commit to adhere to the same in writing.
There is robust ethics counsellor process to monitor implementation of TCoC. The TCoC incorporates within its fold, the Human Rights principles, which thus get monitored during the process of monitoring of the former. Employees, as well as outsiders, have the liberty to raise concerns if any, related to the Tata Code of Conduct and the Human Rights Policies thus. Ethics Counsellors, who are present at all locations, address these concerns.

In relation to the process of managing the business ethics, it is of much avail to talk about the Whistle Blower Policy at Tata Motors (whistle blower policy of Tata Motors is available on the companys website at the following link http://ir.tatamotors.com/pdf/whistle-blower-policy.pdf). This policy is an extension of the Tata Code of Conduct. The Whistle Blowers role is that of a reporting party with reliable information. The Policy also defines clearly the composition and role of investigators or fact-finders and that of arriving at corrective or remedial action in each given case. The Policy explicitly mentions pre-requisites to ensure that the identity of the Whistle Blower is kept confidential. All employees of the company are eligible to make Protected Disclosures under the Policy.

2008-09 was a difficult year faced by the automotive sector globally. The spread of the economic downturn of the Western world significantly affected business environment in India as well. The company faced significant pressure in its domestic and overseas markets. Despite the challenges, the company successfully completed the acquisition of Jaguar and Land Rover and launched the Tata Nano, overcoming serious impediments of a last minute plant Income generating activities Tata Motors creates economic value not only for the shareholders but also for other stakeholders. It is estimated that worldwide, Transport sector has emerged as the biggest employer * 1 Commercial Vehicle - employment for 13.3 people 1 Car - employment for 5.3 people 1 Three Wheeler - employment for 3.9 people 1 Two Wheeler - employment for 0.5 people * Source: Automotive Mission Plan 2006-16, Includes: Direct and Indirect Employment Besides creating employment through its business operations, the company also invests in communities at large through its initiatives in enhancing employability through vocational and technical training of youth and of women through the Self Help Groups. The company also encourages formation of co-operatives and mentors individuals to enable them to start their own enterprises. In each of the manufacturing units of the company, apprenticeship training programmes are carried out. An overview of the impact of some of these initiatives is given below: location amidst much political turmoil.

CSR Departments look after CSR at plant locations. These are independent departments that cater to varied conditions and contexts of the region in which the manufacturing unit is located.The Heads of the CSR departments at each manufacturing unit administratively report into the HR Head of the manufacturing unit, which in turn reports to the Plant Head. The CSR department at facility level, functionally report to the Corporate CSR Head. The starting point for any community development initiative is the conducting of surveys through administering questionnaires during home visits, conducting focused group discussions along with key informants interviews for understanding the socio economic and cultural milieu of the villages. The compilation of the baseline data is followed by an active engagement process with the communities to identify and prioritize the felt needs of the community at large. Once needs are prioritized, community development programmes are designed, resources identified and allocated before the projects are implemented.

Implementation of the programme differs at locations. Initiatives are implemented through Tata Motors supported organizations in Jamshedpur (Gram Vikas Kendra for rural development; Nav Jagrat Manav Samaj for treatment and rehabilitation of leprospatients; Parivar Kalyan Sansthan for health care of comm Kendra for educational initiatives) and Lucknow (Samaj Vikas Kendra for rural development and Jan Parivar Kalyan Sansthan for health initiatives). The CSR department directly implements projects at other locations. At almost all locations, including the non-plant locations, partnership is forged with nongovernmental organizations for implementation of community development initiatives unities and Shiksha Prasar.

Four Branches making automotive components, cable harnessing, utility item making, Employment Generated: 1200 women, mainly wives of operative grades &needy community members Turnover: Rs. 52.28 million Management: All processes internally managed through elected Society members Growth: Training through internal trainers business development through internal team products making. 22 women employed in assembly line including widowed and physically differently abled. Over 4000 chapattis made and sold everyday to industrial canteens by village women

HEALTH
Curative & preventive health services Over 5 lakh community members benefited so far - 2500 patients covered by trained Village Health Workers
More than 5000 so far 4000 villagers participated in 2008-09

Low Cost Toilets Cleanliness drives

EDUCATION
100 schools benefited

Infrastructure development, facility upgradation 100 schools benefited and donations Extra curricular activities for overall personality More than 50,000 students so far development Scholarship for higher studies Teachers training for improving the quality of education

More than 50,000 students so far

More than 500 students annually Training module developed for Anganwadi teachers in 2008-09

EMPLOYBILITY
Vocational training 1048 youth, of which 570 were women in 2008-09

Technical Training

Over 5000 youth trained in MMV, refrigeration

Entrepreneurship development

200 entrepreneurs created in 2008-09 mid day meal, garages, honey making, tailors, garage owners, etc

ENVIROMENT
Increasing the green cover Increase irrigational facilities for agricultural development More than 10million trees 132 ponds created in 2008-09

Reduce GHG through promotion of alternate fuel resources

17 bio-gas plants constructed in 2008-09

Tata Motors won the Wall Street Journal Technology Innovation Award in the 'Transportation' category for the Nano, which is credited with being 'a very impressive design accomplishment'. CVBU won Sustained Excellence trophy at the 14th JRD QV awards, in 2008 for sustained excellence for past 3 consecutive years. Tata Motors has been honoured with the NDTV Profit Business Leadership Award 2008 in the 'Automobiles - 4 wheelers' category. Indica Vista won the Jury Award at the Business Standard Motoring Car of The Year Awards. Tata Motors CVBU Pune won CII-National Award for Excellence in Energy Management 2008 and also declared as Excellent Energy Efficient Unit. Tata Motors CVBU Pune has won the Rajiv Gandhi National Quality Award for 2007 in the large scale manufacturing organisation category. Tata Motors Training Division CVBU Pune won the prestigious Golden Peacock National Training Award for 2008 and the Best Establishment Award by DGET, Ministry of Labour and Employment, Govt. of India, New Delhi.

Land Rover has been honoured with two Queen's Awards for enterprise (One for International Trade and Second for Innovation). Jaguar has been ranked number 1 in J.D. Power and Associates 2008 Sales Satisfaction Index (SSI) Study. Jaguar XF sports saloon has been named the What Diesel Car of the Year and also topped the Executive Car category in the What Diesel magazines prestigious annual awards. Land Rover won an award for the best diesel 4x4 with the Freelander 2. Jaguar's Ian Callum has won The Walpole Award for British Luxury Design Talent at Walpole Awards 2008.

Sumo (ranked No. 5), Indica (ranked No. 9), Safari (ranked No.13) and Indigo (ranked No.16) were among 'Most Trusted Brands' of India. Engineering Export Promotion Council (EEPC) awarded Tata Motors with the Top Exporter Gold Trophy in the Large Enterprise category. Tata Motors has been ranked first in India in Investor Relations in the Thomson Reuters Extel Asia (ex-Japan) Survey 2008. Tata Motors was recognised as Top Knowledge Contributor in the Western Regional Network Forum, Tata Group Tata brand has been ranked 51st most valuable brand in a global league chart compiled by Brand Finance (BF) Plc., a UK-based consultancy and the Tata brand was valued at $ 11.85 billion as of August 2008.

Mr Ratan N. Tata, Chairman was conferred with NDTV Automotive Man of the Year 2008 award. Mr Ravi Kant, Vice-Chairman was conferred with an Honorary DSc by Aston University in Birmingham, the UK. Mr S. N. Ambardekar, Plant Head was conferred with the Performance Excellence Award (Individual) at 11th CEOs Conference, by Indian Institution of Industrial Engineering (IIIE).