THE HISTORY OF TATA MOTORS Tata Motors was a division of the Tata Group, which was India’s largest corporation, owning more than 90 companies spanning seven business sectors (chemicals, information technology and communications, consumer products, engineering, materials, services, and energy). In 2012, the corporation had operations in over 80 countries, and it had gross revenues of $83.5 billion in 2011. The company’s gross revenues dipped to $96.8 million in fiscal 2013, after having reached $100 million in 2012. Nearly 60 percent of the Tata Group’s revenues were generated outside India. The Tata Group was a powerful symbol of India’s emergence as a world economic power and was India’s largest private-sector employer, with over 425,000 employees.
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However, in 2013 and 2014, the company’s namesake brand slid into a decline, both domestically and internationally, with the company eventually losing its number-three rank in automobile sales in India to Honda. Also, the company’s sales of commercial vehicles declined in 2013 and 2014, causing the company to drop from fourth-largest seller of commercial vehicles to fifth. Some of the company’s poor performance could be attributed to poor macro-economic conditions in India, increasing competition, and a variety of other external factors such as the possible elimination of diesel subsidies by the Indian government. However, much of the company’s poor performance was a result of many factors:
• Safety standards. Unfortunately, Tata has not gained a strong reputation as being a “safety brand.” One prominent example is Tata labeling the Nano as being a safe 16 and affordable car and then receiving horrible safety ratings. They even received a zero-star rating for child protection. This has led to much damage to reputation. According to consumer responses, the Nano would be much more successful if the product design was safer and especially included …show more content…
This is a problem because the population demographics show a huge young consumer base now and for many years to come for India and the designs of the cars are not particularly attractive. If Tata could develop products with a more sleek and “hip” design they may be able to better capitalize on the young population which tends to be more concerned with design than some of the older generations.
• Limited presence abroad. Although Tata has been successful in India and some surrounding nations, they are only recently starting to build more of a presence in European nations. Much of the rest of the world they have conducted business in but been unable to gain a large market share.
• Lack of success in luxury market for India. Although Tata has been able to acquire Jaguar and Land Rover, the company has still been struggling to excel in the domestic luxury market. Part of this problem could be the brand reputation as being a low-cost and they have not made significant marketing efforts to build awareness to the Indian population of their acquisitions in the luxury market. Perhaps if there were more public relations and advertising efforts, part of the consumers’ perception of Tata Motors would fade away and help them in the luxury market.
In order to get out of this financial hurdles two solutions are available for Tata
However, in 2013 and 2014, the company’s namesake brand slid into a decline, both domestically and internationally, with the company eventually losing its number-three rank in automobile sales in India to Honda. Also, the company’s sales of commercial vehicles declined in 2013 and 2014, causing the company to drop from fourth-largest seller of commercial vehicles to fifth. Some of the company’s poor performance could be attributed to poor macro-economic conditions in India, increasing competition, and a variety of other external factors such as the possible elimination of diesel subsidies by the Indian government. However, much of the company’s poor performance was a result of many factors:
• Safety standards. Unfortunately, Tata has not gained a strong reputation as being a “safety brand.” One prominent example is Tata labeling the Nano as being a safe 16 and affordable car and then receiving horrible safety ratings. They even received a zero-star rating for child protection. This has led to much damage to reputation. According to consumer responses, the Nano would be much more successful if the product design was safer and especially included …show more content…
This is a problem because the population demographics show a huge young consumer base now and for many years to come for India and the designs of the cars are not particularly attractive. If Tata could develop products with a more sleek and “hip” design they may be able to better capitalize on the young population which tends to be more concerned with design than some of the older generations.
• Limited presence abroad. Although Tata has been successful in India and some surrounding nations, they are only recently starting to build more of a presence in European nations. Much of the rest of the world they have conducted business in but been unable to gain a large market share.
• Lack of success in luxury market for India. Although Tata has been able to acquire Jaguar and Land Rover, the company has still been struggling to excel in the domestic luxury market. Part of this problem could be the brand reputation as being a low-cost and they have not made significant marketing efforts to build awareness to the Indian population of their acquisitions in the luxury market. Perhaps if there were more public relations and advertising efforts, part of the consumers’ perception of Tata Motors would fade away and help them in the luxury market.
In order to get out of this financial hurdles two solutions are available for Tata