Each of Tata’s passenger cars in India barring Indica loses money, the Tata Sons chief said, but is confident of a turnaround.
New Delhi, October 11, 2017: Tata Motors has chalked out an elaborate plan in its bid to turn around its loss-making Indian automotive unit and the business is a “priority” at the group level, Tata Sons Chairman Natarajan Chandasekaran has said according to moneycontrol.com.
In an exclusive interview with CNBC-TV18’s Shereen Bhan, the 55-year-old Tata Sons boss outlined the broad action plan for both Tata’s commercial vehicles and passenger car segments, “in terms of growth, market share, as well as profitability”.
Since its acquisition of Jaguar Land Rover in 2008 in a distress sale, the British luxury car unit has risen to become the mainstay for Tata Motors, accounting for nearly 85 percent of its Rs 2.8 lakh crore revenue and all of its profits.
According to the reports published in moneycontrol.com the domestic passenger cars business has for years suffered from a weak product lineup and perception of poor quality. The commercial vehicles business in India, where Tata is a major player, has suffered a slowdown due to the economic cycle even as the company ceded market share to rivals.
Under Tata’s renewed HorizonNext strategy, the company has over the past few years launched a slew of products, many of which have been well received by critics and customers.
For the commercial vehicles’ market share, Chandrasekaran said Tata Motors had brought “tremendous focus”, was addressing the product gap and that “significant effort (is) going on specifically on cost management, on profitability improvement”.
The Tata Sons Chairman also downplayed concerns on losses being made by the Nano and said they were very small, about 4 percent of the total losses in the PV business.
“So, whether you shut down Nano, whether you give it life, number is not going to change, needle is not going to move. But, we have got multiple options in front of us, not only for Nano, but for every other model and we are evaluating all those models,” he said.
Chandrasekaran also expressed happiness over Tata Motors winning EESL’s 10,000 electric vehicle (EV) bid.
Moneycontrol.com also quoted that he was also confident that the company would make money at the price point at which it would sell electric cars to EESL — contrary to claims by rival Mahindra, which claimed it would lose money even on the higher price that it had bid.
He said that the company was investing significant amount of money into Jaguar Land Rover (JLR) to achieve its “ambitious plans” including new product development.
“We put 4-5 billion [pounds] every year. So, there is a big ambition and what is the route to achieving that ambition is something that is being deliberated upon,” he said.