bisiness outlook

8/14/2019 Bisiness Outlook

1/38

Indian Automobile Industry:TATA Motors

Submitted By:Vikram Singh

Marketing Operations


2/38

Presentation Flow

Indian Automobile Industry: Overview PEST Analysis

Porters 5F Analysis Tata Motors

History

Product Financials SWOT


3/38

Indian AutomobileIndustry

Growing at the rate of 15-27 per cent over the past five

years.

India ranks 12th in the list of the world's top 15

automakers.

Entry of more international players.

Concentrated in regions. Market size estimated to be of Rs.225 Thousand crores

( $45 Billion)


4/38

Contributes 5% to the GDP.

Production of four wheelers in India has increased from

9.3 lakh units in 2002-03 to 23 lakh units in 2007-08.

Targeted to be of $ 145 Billion by 2016.

Exports increased from 84,000 units in 2002-03 to

280,000 units in 2007-08.


5/38

Commercial Vehicles


6/38

Key facts

Currently going through demand correction.

Grew at 25% in 2001-2007 as compared to 5% in FY

2008.

Split between LCV and M/HCV.

Dupolistic in nature

LCV: M&M and TATAs own majority marketshare.(90.8%)

M/HCV

Ashok Leyland and TATAs hold 88.6% of market.


7/38


8/38

Key Success factors

Ability to enhance and vary product mix.

Sales and Distribution service network.

Access to new technologies.

Balance between outsourcing and in-house

productions. Government regulations.


9/38

Concerns

Higher steel prices.

Slowdown in Indian economy.

Rise of railways in freight transports.

Polluting vehicles.


10/38

Passenger Vehicle Industry


11/38

Market Segments


12/38

Key Facts

Grew 14% YoY to 1,762,131 as against1,545.223 units

in 2007-08.

Passenger car contributed 80% of passenger vehicles

sold.

Domestic sales grew to 12% YoY.

Last five years CAGR of 19.5%. Share of exports is 12.3%.

Fragmented market with around 14 players.


13/38


14/38


15/38

Structure of Indian PVMarket


16/38


17/38

Key Success Factors

Presence across segments.

Efficient Operations.

Wide dealer network and availability of finance.

Access to latest technologies.

Varied new offerings.

Exports.

Favorable Budget.

Increase in affordability.


18/38

Concerns

Increasing raw material cost.

High competition.

Roads and Infrastructure.


19/38

PEST ANALYSIS


20/38

Political-Legal Factors

Auto Policies(AMP).

Government regulations and support.

100% FDI allowed.

Import Duties reduced.

Budget 2008. Recent announcement to buy vehicles.


21/38

Economic Factors

GDP growth of 5.1%.

Inflation down to 2.6%.

Fuel prices at Rs. 44.

Economy less affected to recession as

compared to other nations. Nano effect.


22/38

Social Factors

Growth in urbanization.

Lower ownership costs.

Rising incomes of middle class.

Cars now more for convenience than status

symbol. Increasing rural consumers income.


23/38

Technical Factors

Rising world class auto-component industry.

MNCs bringing advanced technology with

them. Acquisition of foreign firms helping to gain

technology.

Increased government involvement in

technology development.


24/38

Porters 5F Analysis


25/38

Bargaining Power of Suppliers

Supplier concentration.

Importance of volume to supplier.

Differentiation of inputs.

Impact of inputs on cost or differentiation.

Switching costs of firms in the industry. Threat of forward integration.


26/38

Bargaining Power of Customers

Brand identity.

Price sensitivity.

Product differentiation.

Substitutes available.

Contribution to Cost. High service demand.


27/38

Threat of Substitutes

Many models available in similar pricerange.

Little product differentiation.

High marketing exposure. Availability of Close substitutes.


28/38

Threat of Competition

Industry concentration. Similar product offerings. High brand following. Diversity of rivals. Proprietary products.


29/38

TATA Motors


30/38

History

Started in 1945 in Mumbai,India.

Original production was on

locomotives.

1954 First car rolled off of the

assembly line.

Tatas are a family of Indian

industrialists and

philanthropists.

The family founded:

Ironworks

Steelworks

cotton mills hydroelectric-power plants

Are of their endeavors have

been proved to be crucialto India's industrial

development.


31/38

History

Tata Motors is Indiasowns the largest

independent company in

India. Mercedes and Tata

teamed up to create a

truck line. First major business deal

with another firm.

Together both companiesstarted their commercial

vehicle operations in

1960. In 1986 the company

created and sold the first

LCV LCV = light commercial

vehicle

Was the Tata 407


32/38

History

Tata Motors decided to

pursue joint ventures.

Cummins Engine Co.,

Inc., was the first company

to jointly venture with Tata

in 1993.

Manufactured a dieselengine that had high

horsepower and emitted

less harmful chemicals.

Began creating new lines

in the late 1990s and

early 2000s:

Compressed natural gas

buses

1109 vehicle, used for

commercial purposes. Ex-series

Newly designed LCV

called the 207 DI


33/38

Products

Passenger Cars

Indica Vista

Indica V2

Indica V2 Turbo

Indica V2 Xeta

Indica V2 DICOR

Indigo XL

Indigo

Indigo Marina

Indigo CS

Utility Vehicles Safari DICOR Sumo Grande Sumo

Commercial Passenger Carriers Buses Winger Magic

TrucksMedium & heavy Commercial vehiclesLCVsAceTATA Novus

Defense Vehicles


34/38


35/38

MARKETSHARE


36/38

Tata Motors: Finances

Revenue as on 31 st Dec 08 Rs. 47136.30 crores

PAT: Rs. -2632.60 crores

Assets as on 31 st March: Rs. 261182.60crores

Total Debt/Networth March 08: 0.80


37/38

Tata motors: SWOTStrengths

Well-known brand with goodreputationPlanned and smart internationalstrategySmart approach in responding to themarket demand.Alliances with key playersFast product development ability

Weaknesses

Low level of infrastructures Lack of experience in certain newsectors.

Opportunities

New long-awaited product (Nano) Government support Emerging markets high demand for passengers cars at low costs.

Threats

Downturn of the world economy High level of competition Sustainability and environmentalism Oil rising prices


38/38

Thank You

bisiness outlook

Documents