Tata Motors Case study

Presented By:
Group 10
Lavina Dhamecha – 98
Charmi Jain – 103
Mihir Jamadagni – 104
Monal Raut – 107
Shivani Gazinkar – 109
Nitin Kadari - 119
Introduction

● The disparity between the Eastern and Western markets

reflected global economic slowdown which favored cheaper and
more fuel efficient vehicles.
● Tata Motors Limited has both strategic and economic gains from
the acquisition of Jaguar and Land Rover, which would help the
company to get a global image as well as entering the
prestigious segment of the worldwide automobile market.
● In this case we will try to analyze the situation around Tata
Motors bid for JLR and if it should go ahead with the acquisition
of Jaguar and Land Rover, or should Tata stick with its current
image of economic cars and go through an economic growth.
Q.1. Describe the economic characteristics of the
global motor vehicle industry.

 Change in Industry focus

 Some did not focus on change
 Financial crisis
 Tata set an example.
Q.2.What are the key success factors for a
successful firm in the global motor vehicle
industry?

 Pricing Pressure
 Consumer Spending Trend
 Broad Differentiation Strategy
 Market Analysis and innovation
Q.3. What are Tata Motors’ internal strengths and
weaknesses? Identify competencies and capabilities that
the company’s major competitors are lacking. What
market opportunities does the company have and what
threats can you identify that may negatively impact the
company’s future?
 Strengths:-
 One of the biggest corporations
and fourth-largest truck
manufacturer corporations.
 Tata Nano car which is the world’s
cheapest car.
 Providing wide range of products
that offered the lowest cost of
ownership.
 Growth in international markets.
 Weakness:-
 Main market just focuses on
India.
 Variety means mean a big
production chain and it means a
big investment.
 Not much recognition in US
markets.
Opportunities:- Threats:-
 Capitalize on growth  Biggest market and hence
opportunities in the premium
many players.
market segments by buying
Jaguar and Land Rover (JLR)
 Government policies which
brands. control the automotive

 Attract the big consumer industries.

group.  Nano might not match the

 Growth in Indian economy and needs and wants of American
opportunities in international auto consumers.
markets.
Q.4 Would you describe Tata Motors' international
strategy as a global, transnational, or multi-domestic
strategy? Explain your answer.

 Tata Motors’s international strategy as multi-domestic because –

Tata motors emerges from India and they know well about customer’s
needs,

also in India most of the population has a low-income level so

that’s why Tata motor introduced Nano car.

• Tata multi-domestic strategy more successful in

India as they know what people want and how

much they want to pay so they work accordingly.

Q.5 What are the driving forces in the global motor
vehicle industry?

Driving forces in the global motor vehicle industry :

1.Customer’s demand for motor Vehicle -

Motor industry should also follow the need and demand of
the customer so they could pace up with the expectations.

2. International imports and exports -

vehicle industry will always need to import raw materials from
different parts of the world so they can get desired profits and
also smoothen the import-export between countries.
Q.6 What are the relative strengths of the five
competitive forces affecting the global automobile
industry.

 Highly Competitive Market.

 New Entrants.
 Bargaining Power of Suppliers.
 Bargaining Power of Buyers.
 Substitutes.
7. What is the financial condition of Tata Motors as
indicated from case Exhibits 3 and 4? What is its ability
to meet short-term obligations? What advice can you
offer to Tata’s management based on the information in
the financial statement?

The fiscal year 2011-12 has been very strong for Tata Motors when
compared to its competitors. Though there is an increase in the
expenses incurred, Tata Motors has seen a revenue hike of 35.7%.
The Jaguar & Land Rover has seen a rise in sales in China by 56%
in China, 51% in the US and up to 20% in the UK. Few financial
ratios have improved when compared to that of the previous year.
Debt to Equity ratio has been improving over the year. The
operating profit margin has also seen a rise of 0.3%.
 Looking at Exhibit
 Cost of Employees
 Cost of Material
 Concern of the Current Ratio
 Tata Motors seems to be dependent on JLR
 Management of Tata Motors
8. What do you consider to be the most important
problems and issues facing Tata Motors, based on your
analysis of the company and the global motor vehicle
industry? Prioritize these problems and issues
beginning with the most important.

 Tata Motors is one of the subsidiaries of the Tata Group. With

the availability of funds, resources, and brand loyalty they can
climb up the ladder in Global Automotive Industry.
 Every organization is looking for Globalization but the major
issue with Tata Motors with a limited international presence is
that they want to be the leader in the Domestic Market
specifically Low-Price Segment.
 Although Tata is doing good in the Reports, the deep
inspection of it shows up the underlying issues. Tata motors
need to control their expenses.
9. What actions would you suggest to the company’s
management team to help Tata Motors sustain or improve its
s competitive position in the domestic market and global
markets, and its long–term financial performance?

● Regarding passenger vehicles, Tata has to improve to sustain itself

in the market. Tata Motors must leverage acquisitions and mergers
to transfer new technologies
● Joint Ventures in new countries would make it easy for Tata Motors
to expand its operations.
● It is suggested that Tata Motors come up with a new brand which
comply with trend targeting entry and mid-range customers to suit
their needs and offering them value for money.
● Products with better designs, features, fuel economy and eco-
friendly under a new brand name would help them to sustain in this
competitive industry.
Thank You.