TATA MOTORS

As we discussed last month that many automobile companies are planning to increase car
prices from April this year. This month we already seen price hike announced by Honda Siel
and General Motors India. Now, this time it’s India based Tata Motors which announced
today in a statement that the company is going to hike prices of passenger and utility
vehicles from April 2011.

The company plans to hike prices by Rs 7,000-36,000 depending on model from beginning of
next month. This will be the second price hike in this year. Tata Motors had earlier increased
the price in January 2011. And the bad news is that Maruti Suzuki and Hyundai Motors are
also planning a similar move in order to bear rising input costs.

“Despite continuous cost control initiatives, the company is being forced to take these
increases on account of steep rise in input costs,” Tata Motors said.

he statement said, “In passenger cars, depending upon the model, Tata Indica prices will go
up by Rs 7,000 to Rs 9,000, Indica Vista and Indigo CS by Rs 8,000 to Rs 11,000 and Indigo
Manza by Rs 10,000 to Rs 15,000.”

Prices of utility vehicles will also go up from Rs 13,000-Rs 29,000, starting with Tata Sumo
followed by Sumo Grande and Tata Safari.

Prices of recently launched vehicles – Venture and crossover Aria will also go up from April
1. “Price of Aria will go up by Rs 30,000 to Rs 36,000 and Venture by Rs 9,000 to Rs
12,000,” the statement said.

The Nano price will, however, not be revised. In the utility vehicles segment, Tata Motors
said depending upon the model, Sumo prices will go up by Rs 13,000-15,000. The vehicle is
available for Rs 4.95 lakh to Rs 7.62 lakh currently.
Tata Motors planning to merge commercial and passenger
car dealerships
Posted On 2011-01-20

Tata Motors is going to introduce a new strategy by the end of this month to sell their
vehicles. Tata Motors which manufactures both passenger and commercial vehicles, sell them
through separate dealerships. But, in a new move, which will see Tata Motors merging the
dealerships where both their, passenger and commercial vehicles will be sold.

Tata got the idea to initiate such a marketing move after they saw the sudden change in Nano
sales. Tata was selling Nano through their passenger car outlets and in the month of
November when they managed to sell just 509 units of Nano, they decided to implement new
marketing strategies in order to regain sales.

One of the strategy was to sell Nano through each of their outlets including the one’s that
sold commercial vehicles like Winger Platinum, Ace, Ventura and Xenon. Suddenly in the
next month itself Tata managed to sell approximately 5,500 units of Nano!

Anonymous Tata Motors dealer stated, “We have started selling Platinum in passenger
vehicle dealerships. This will help in expanding distribution apart from combining financial
strength.”

A Delhi dealer for Tata vehicles said, “The margins have taken a hit as sales of models like
Indica and its variants have not grown and Nano is yet to bring in volumes. Fiat Auto (Tata
Motors JV partner) is also facing tough times as sales of its cars are not so encouraging. So,
the extension of vehicles like Venture will add to our sales and service operations.”
Tata Motors, previously known as Tata
Engineering and Locomotive Co Ltd (TELCO),
is one of the largest companies in the Tata
Group, and one of India's largest business
houses. Tata Motors is India's leading
commercial vehicle manufacturer and the third
largest passenger car manufacturer. The
company is the sixth largest truck manufacturer
in the world. Tata Motors recently received the
Balanced Scorecard Collaborative Hall of Fame
Award for having achieved a significant
turnaround of its overall performance. A
comprehensive quality improvement and cost
cutting initiative in September 2000, has played
an important role in the company's turnaround,
from a loss of Rs 500 crores in the year ended
March 2001 to a profit of Rs 28 crores in the
first quarter of 2002-2003.

Tata Motors has realised operational excellence will continue to be the critical determinant of
success in the years to come. This case deals with the strategy adopted by Tata Motors for its
turnaround and operational excellence.
 The highly respected Tata Motors Ltd. has a strong tradition of entrepreneurship. The company’s business
strategy calls for reaching beyond the borders of India to enter new markets for its Nano, the innovative
small car for the urban middle class.
One of the major drivers of success at Tata Motors Ltd. (TML) is its ability to fully exploit information technology to drive business goals.
The company was an early adopter of CAD and CAM systems to speed the design of the Nano. The company also uses Siebel Systems to
manage its vast customer relationship network and SAP® for all critical business services, such as logistics, supplier relations management,
customer relationship management, human resources (HR), and finance.

According to Probir Mitra, Chief Information Officer at TML, “IT is an integral part of every business process from design to delivery and
the power of IT has been extensively leveraged for the Nano project. The design processes used more digital content than ever before. State-
of-the-art CAD and CAM services integrated design across multiple disciplines, making it possible for our designers to harness and benefit
from their inherent ability to innovate. IT helped the company shrink the design cycle time.”

He adds that BSM tools from BMC Software played a key role in tracking and controlling all components of IT services and automating the
management of the IT infrastructure which is vital to the design and planning for manufacture of the Nano as well as running day-to-day
business processes.

EXCELLENCE IN OUTSOURCING
Following its strategy of outsourcing noncore activities, TML has outsourced its IT applications to Tata Technologies Ltd. and its IT
infrastructure to IBM.® The outsourcing decision has proven to be a wise one. TML reaped significant benefits through the outsourcing
initiatives. TML was recognized in 2007 and conferred the “SAP Ace” award for its SRM & Warehouse Management implementations. It
also received the “Uptime Championship Award” at the CIO 100 event in the same year.

Initially, the outsourcing approach posed several challenges. Technology silos were performing adequately. However, a flexible service-
oriented management framework was required to link the silos and provide a comprehensive a view of the IT landscape underlying a given
business process.

To make this framework a reality, TML decided to adopt IT service management concepts outlined in the ISO 20000:05 international
standards, as well as best practices outlined in the IT Infrastructure Library® (ITIL®) Version 3. In addition, the company decided to
establish a service-oriented management architecture that treated IT services .