International Business

Strategy

SUBMITTED TO:
DR. ROJERS P JOSEPH

SUBMITTED BY : GROUP 4 | SECTION B

ASHIMA GOEL | DEEPALI GUPTA | NIRAJ | PRAKHAR
NAGAICH | NASREEN RAHAT | NEETA KUMARI |
KRISHNAKANT MAHESHWARI
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TATA Motors : An Overview
Founded in 1945, a part of Tata Group, TATA Motors is India’s largest automobile company
Only OEM offering extensive range of integrated, smart and e-mobility solutions.

Entered commercial
Launched Indica
vehicle sector
Formed JV with First fully
Dailmler-Benz indigenous Indian
passenger car
1954 1998

Product 2016
s
Passenger cars, Ranked 226th on
trucks, Vans, Buses, the Fortune Global
Sports Cars, Military 500 list
vehicles
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Vision, Mission & Values

Vision
By FY 2024, we will become most
aspirational Indian auto brand,
consistently winning, by
▫ Delivering superior financial returns
▫ Driving sustainable mobility
solutions
▫ Exceeding customer expectations,
and
▫ Creating a highly engaged
workforce
Mission
We innovate mobility
solutions with passion to
enhance quality of life.
Values
Teamwork, Integrity,
Accountability, Customer
focus, Excellence, Speed
4th largest
4

manufacturer
Europe, Asia, Middle
Of Mid/Heavy commercial vehicles

East
Major Presence

M&A, Joint Ventures

Major strategy of entering foreign markets
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Globalization Strategy in General

1 2 3 4

Through Strategy behind Focus on a narrow Dedicated

collaborations, these is to develop base of 14-15 manufacturing facilities,
Mergers & new technologies , countries, market marketing teams &
Acquisitions and new markets and conditions similar to Sales teams
Joint Ventures new product India
development Evaluates locations on
the basis of market
opportunities & labor
skills
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Expansion in United Kingdom

United
Kingdom

Head office
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UK Automobile Industry

Ford
▫ Ended its passenger car assembly in 2000
▫ Hugely invested in diesel factories

Jaguar
▫ Faced heavy losses
▫ Browns Lane Plant closed in 2004.

Chinese carmaker, Nanjing Automobile took over

MG Rover
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Entering Strategy in URK

Export of TATA Telcoline -1 tonne pick- Investment in Tata Motors Euoropean
up truck Technical Centre

Acquisition of 94.3% stake in

21% Stake in Hispano
INCAT International Ltd. by TATA
Carrocera
Technologies

Acquisition of Jaguar Land Rover PLC

MoU with Fiat (2005)
in 2008

TATAs entered the market through partnership, opening up subsidiary and entering
the commercial vehicle platforms in several countries.
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CHALLENGES
Brexit
• Political uncertainty
• Import duty likely on JLR cars by European Union countries
• Reduced sales across Europe
Trade Wars
• Reduced sales in US due to hike in tariffs
• Chinese sales dip by 45% YoY due to reduced tariffs
• Affected by taxation woes
Diesel Portfolio
• Reduced sales of the diesel portfolio
• Impending imposition of complete ban on new diesel vehicles
Poor perception
• Challenges pertaining to perception of poorly made cars
• Significant impact on sales of JLR in the UK market.
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Overcoming Challenges
• Offer new exciting models
$ 1.6 bn • Eyes on the 44% Slovakian “premium automotive sector”
Manufacturing
facility in Slovakia • Protection against currency fluctuations
• Support a globally competitive business

Shifting focus on • UK to go electric starting 2030

electric vehicles • Focus on “clean” cars

• Collaboration for focus on R&D into electrical vehicles

Collaboration with
• Leveraging on economies of scale
BMW
• Sharing the R&D spending

• Cut losses and spending in order to turnaround the business

Project charge • Targeted save of 2.5 billion pounds ($3.2 billion) over 18 months
• Reducing non-productive investments and speeding asset sales

Analysis and Suggestions
▫ Crisis amidst political and economic uncertainty
due to BREXIT and trade wars challenges
▫ New plant in Slovakia can be used to export cars
to other European countries
▫ Focus on debt reduction to maintain financial
viability
▫ Shut down plants & product lines which have not
been very profitable
▫ Cost & revenue synergies through TATA group
▫ Should focus on R&D and further developments
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Current Scenario
 Massive loss of ₹ 3,679.66 crore
in Q1 2019-20
 Retail sales in June 2019 were up
4.6% in UK although down 9.6%
YoY
 Slump in sales North America (-
9.0%), Europe (-11.7%), China (-
12.3%) and in Overseas markets
(-18.6%)
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Expansion in Malaysia

Head office

Malaysia
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Malaysia
Automobile Industry
▫ Dominated by Toyota Hilux & the Ford
Courier

▫ Ford Malaysia , first company to add

comforts & good looks in pickup segment

▫ Mitsubishi launched Storm, which

became Ranger’s top competition

▫ Nissan launched Frontier after the

introduction of Ranger

▫ 50% share in the market dominated by

 • Constitutional monarchy with a parliamentary
PESTEL Analysis •
system of government
Political risk of 8/10 shows political conditions
are stable & conducive

• Ranked 23rd out of 183

countries in the World Bank’s • 3rd largest ASEAN market
of doing business • Automobile industry
• Takes just 11 days to start a registered Decrease of 7.5%
business as against the 37 in sales during 2011 and is
days it takes in China expected to increase in 2012

• Literacy rate stood at 92.8%

• Energy efficiency is given in 2009
utmost importance and • Unemployment rate only
government encourages 3%, indicates availability of
such cars huge labor force

• Improved productivity by 44%between 2001 & 1

2006, because of innovation and new 4
technologies
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Traditional Method of Export

Notching up export revenue of Rs 969
crores in first 9 months of FY 2004-05

ENTRY
Assembly Operations Abroad:
STARTEGY First assembly line in Malaysia was set up
in 1974 and has continued the same since
IN then

MALAYSIA
Joint Venture & Acquisition
• Entered in JV with Thonburi automotive plant
in Thailand
• Strucka deal for JV with Air Asia in which it
holds 49% of stake
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Challenges in Malaysia
 Strong competitor like Toyota and Proton
 Unstable fuel prices
 Booming energy efficient car market
 Sluggish economic condition
 Not easy to develop distribution channel and center
 OEM network for spare parts is not wide
 Structured program to educate DRB-HICOM about India, Tata
Group and Tata Motors
 Communication (in Malaysian) to management, unions and
employees emphasizing Tata Motors capabilities and Tata Group‘s
reputation for good corporate governance
 Steps Taken to Overcome Challenges
Strategic partnership with dealers & 3rd party logistics to take advantage of:
• Existing customers in terms loyal customers 
Partnership • Sales and service expertise 
Strategy
• Reputation/brand equity 
• Market access/knowledge

• Launched 3 new commercial vehicle models for Malaysian market in

2018
Launch of new
vehicle models • Partnered with authorized Malaysian distributor DRB-HICOM
Commercial Vehicles
• Vehicles launched :Tata Super Ace, Tata Ultra 814 and Tata Ultra 1014
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Value Chain Analysis

 SWOT Analysis
STRENGTHS

T H R E AT S S • Strong brand 
• Strong financials that can help to
expand in new markets. 
•

•
Strong competitors like Toyota.
proton 
Unstable Fuel prices 
T W
• Tata Xenon launched in
Thailand market.
• Technological know-how
• Booming energy efficient car

O
market 
• Sluggish economic conditions WEAKNESSES

OPPORTUNITIES • No distribution centres in

Malaysia
• Growing market Of Pickups in Malaysia • Lack Of availability Of
• Leverage upon Free Trade Agreement components and spares
among ASEAN  • Huge dependence on dealers
• Multi-sourcing strategy-- more import in Malaysia
freedom
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Recommendations

 Invest in R&D for developing fuel efficient vehicles in different

categories
 Compete on price – provide value for money options
 Collaborate with Malaysian government to pioneer ways for
development in electric cars and its infrastructure
 More strategic partnerships should be developed for a robust
distribution network and promotions through them
 Set up manufacturing facilities in Malaysia if the demand
increases
 Utilize strong brand name of TATA by providing more customized
vehicle models for Malaysian market at competitive prices
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THANKS!
Any questions?