Swot Analysis Tata Motors

TATA Motors is a Multinational Corporation Headquartered in Mumbai, India. TATA Motors is India’s largest automobile company, with consolidated revenues of USD 20 billion in 2009-10. It was formerly known as TELCO (TATA Engineering and Locomotive Company). Established in 1945, when the company began manufacturing locomotives, the company manufactured its first commercial vehicle in 1954 in collaboration with Daimler-Benz AG, which ended in 1969. Despite the success of its commercial vehicles, TATA realized his company had to diversify and he began to look at other products.

So after years of dominating the commercial vehicle market in India, TATA Motors entered the passenger vehicle market in 1991 by launching the TATA Sierra, a multi utility vehicle. After the launch of three more vehicles, in 1998 it launched TATA Indica, India’s first fully indigenous passenger car. Designed to be inexpensive and simple to build and maintain, the Indica became a hit in the Indian market. It was also exported to Europe, especially the UK and Italy. To establish a global presence, TATA Motors has been in the process of acquiring foreign brands.

Among these acquisitions is Jaguar Land Rover, UK ; Daewoo Commercial Vehicles Company, South Korea ; 21% controlling stake in Hispano Carrocera, Spain. TATA also has formed joint ventures with Brazil based Marcopolo, to maufacture fully built buses and coaches for India and other international markets. TATA Motors also formed a joint venture with Fiat and gained access to Fiat’s diesel engine technology. TATA Motors sells Fiat cars in India through a 50/50 joint venture. Strengths:

•TATA Motors Limited is India’s largest automobile company, with revenues of around US$ 20 Billion in 2009-10. •TATA motors is market leader in Automobile Industry with high market share. •TATA Motors Company have huge employee base. •TATA motors employee productivity percentage is higher. •TATA motors produce low price cars with low fuel consumption. •TATA motors is the reputable brand in Indian Industry. •The company’s dealership, sales, services and spare parts network comprises over 3500 touch points.

•TATA Motors has been aggressively acquiring foreign brands to increase its global presence. •The research and development department of TATA motors is very strong. •TATA motors posses High corporate responsibility. Weaknesses: •Return on Investment on TATA motors shares in low. •TATA motors is not able to meet safety standards in their vehicles. •The domestic sales of the company are not up to the mark. •TATA has not got a foothold in the luxury car segment in its domestic market. Opportunities:

•TATA motors can take the advantage of their low cost car by entering into third world countries where people have low purchasing power. •TATA motors should focus in developing luxury cards. •TATA motors can introduce more safety features in vehicles to gain more customer satisfaction. •Joint ventures in other countries allow TATA motors to easily enter into new market. Threats: •TATA motors have low cost advantage over its competitors, once the competitors find out the low cost production methodology then there will no competitive advantage.

•Other companies are starting to compete for some of this market share. In fact, the Pakistan’s Transmission Motor Company has built a basic four-wheeler for only $2,100. This car is considerably cheap and the Pakistan Transmission Motor company started exporting them to Sudan, Qatar, and Chile. This is going to be the beginning of new emerging car manufactures that will be producing low priced cars. •The major challenge for TATA motors is the rising prices of steel, Aluminum and plastic which is heavily used in vehicle manufacturing. •The low safety standards can impact the sales.