BPSM Assignment – 1

PESTLE Analysis on Tata Motors

What is PESTLE Analysis?

PESTLE Analysis examines the various external factors like political, economic,
social, technological (PEST) which impacts its business along with legal & environmental
factors. The PESTLE Analysis highlights the different extrinsic scenarios which impact the
business of the brand.
PESTLE analysis is a framework which is imperative for companies such as Tata
Motors, as it helps to understand market dynamics & improve its business continuously.
PESTLE analysis is also referred to as PEST analysis.

Political Factors:
Tata Motors is working in auto manufacturing sector and significantly in excess of
dozen nations in this manner it brings about savvy introduction itself in various sorts of world
of politics and political framework dangers. Tata Motors need to update based on the
changing nature of political factors. Like, Tata Motors previously tied up with state
government of west Bengal and acquired some land to manufacture Tata Nano cars but this
acquisition of farmlands resulted in the “Save Farmlands” movement which is initiated by a
political leader “Mamata Banerjee” and this movement made Tata Motors to close the plant
in West Bengal and move to Gujarat. This made a huge loss to Tata Motors.

Economic Factors:
Tata Motors has a huge effect on the economic factors. As due to this pandemic, Tata
Motors have faced a revenue loss of nearly 50% in FY2020 but in the FY2021 it showed a
revenue increase of 8%. However it had failed due to its inefficiency engines of various
models later it catches the market. Also due to its price pressure from the competitors made
Tata Motors to perform low. On basis of the scraping of petrol and diesel cars by 2030 made
auto industry to struggle a lot but also Tata Motors upgrade to Electronic Vehicles made it
low priced EV to the Indian market. Also the failure of EV’s batteries made the government
to cut subseries on the tata manufactured EVs.

Social Factors:
Tata Motors from the TATA Family has the greatest public support and TATA itself a
brand known for its trustworthiness and loyalty. Even there are many loyal customers to the
brand till date. Currently Tata Motors is running some hundreds of NGOs and also involving
in many CSR activities. Also Tata Motors is the only Indian auto manufacturing MNC which
gives pried among the employees as well as the customers.
Technological Factors:
Tata Motors is the one of the highly spend companies for R&D and it also invested
thousands of crores for the R&D. This made Tata Motors sustain even after failure. Their
innovative engines made a new hype in the market and also their new designs of the models
like, Hector, Hexa, Nexon and many are lining up as a greatest competitor at the same price
ranges.
Introduction of low budget EVs also made Tata Motors to move into the EV segment
prior to many brands. Eventhough there are some failures but in future as a result of R&D
department, Tata Motors may become the leading EV producers.

Legal Factors:
Tata Motors, like a major company and from the TATA family, is also bound by
several legal factors. Government laws and policies also plays an important role in Legal
factors of Tata Motors.
Laws pertaining to Patents of technology and operations are inadequate. Lobbying
activities also play an important role in operation in India.

Environmental Factors:
Environment factors plays an important role in impacting the business of Tata Motors
and any other auto manufacturing companies. The organization is advancing electric vehicles
and furthermore the organization is seeking after the conceivable outcomes of eco-friendly
mixture autos. The particular natural change attributes are basically the open entryway for the
Tata Motors. Also the government’s vision to completely scrape diesel and petrol cars by
2030 and such environmental measures pose a threat to the company.