tata motors supply chain management case study

Tata Motors Case Study: History, Business Model, Products, Financials, Peers, and SWOT Analysis

From the streets of Mumbai to the prestigious avenues of London, the growls of Tata Motors engines echo across the globe. This Indian automotive giant has come a long way, evolving from a locomotive manufacturer to a diverse automobile powerhouse.

In today’s blog, we will delve into the world of this fascinating company from exploring its rich history to ambitious plans. 

Table of Contents

Overview 

Tata Motors is India’s 3rd largest automobile company and is a leading global manufacturer of cars, utility vehicles, buses, trucks, and defence vehicles. Tata Motors was incorporated in the year 1945 and was a part of the Tata Group which was founded by Jamshedji Tata in the year 1868.

Some of the world’s most iconic brands, including Jaguar Land Rover in the UK and Tata Daewoo in South Korea are a part of the automotive operations of the group.

Tata Motors is committed to developing innovative and sustainable vehicles for the future of mobility. The company operates on a philosophy of ‘giving back to society’.

Additionally, in a major push for clean transportation, Tata Motors signed a deal to supply 3,500 EVs to BluSmart Mobility, India’s first electric and shared smart mobility company, expanding Delhi NCR electric fleet and offering customers more environment-friendly travel options. 

The history of Tata Motors dates back to 1945. Tata Motors was founded as Tata Engineering and Locomotive Company (TELCO), which initially focused on locomotives.

The company entered the commercial world market in the year 1954 through a joint venture with Daimler-Benz, establishing India’s first heavy vehicle manufacturing facility. Gradually it expanded the commercial vehicle portfolio with trucks and buses, becoming a dominant player in the market.

2008 marked a turning point with the acquisition of Jaguar and Land Rover from Ford, propelling Tata Motors onto a global stage.

Did You Know?

In the year 1991, India’s first sports utility vehicle (SUV), Tata Sierra, was designed and manufactured by Tata Motors.

Highlights (FY 2022-23)

• Presence in more than 125 countries.
• INR 20,265 crore was spent on research and development.
• 25 manufacturing facilities.
• 81,811 collective workforces.
• 3,72,217 units of Jaguar and Land Rover (JLR) sold.

Subsidiaries

Some of the subsidiaries of Tata Motors is mentioned below:

• Tata Motors Passenger Vehicles Limited

TMPV is a wholly-owned subsidiary of Tata Motors and leads the passenger vehicle business in India. The company offers a diverse range of sedans, SUVs, and electric vehicles.

• Tata Passenger Electric Mobility Limited (TPEM)

TPEM was established in FY 2021-22 to carry out the Passenger Electric Mobility Business with a funding of INR 7500 crore from TPG Rise. The company aims to channel future investments into electric vehicles.

• Jaguar Land Rover (JLR)

JLR, a well-known British manufacturer of luxury cars, was acquired by Tata Motors in 2008. The company exemplifies quality and sustainability.

• Tata Motors Finance Limited (TMFL)

TMFL and Tata Motors Finance Solutions Limited (TMFSL) are TMF Holdings Limited (TMFHL)’s Non-Banking Financial Companies (NBFCs) subsidiaries. TMFHL is a Core Investment Company (CIC) and Tata Motors’ completely owned subsidiary. TMFL provides vehicle financing solutions to Tata Motors customers in India.

Business Model

Tata Motors holds 10 manufacturing facilities, and 3 R&D/engineering and design centres. Furthermore, there are 12 worldwide manufacturing and engineering facilities for JLR.

The company aims to become the most aspirational brand in the Indian Automotive Industry.

Full range of activities that TML provides includes manufacturing operations, logistics, financial services, global sales network, customer service network, mobility service, innovation and technology, design and engineering, and strategic sourcing.

Product Portfolio

The existing Commercial Vehicle Range of the company is as follows

MHCV, Buses and Vans, ILCV, SCV and PICKUP.

Last but not least the showstopper in the CV range is the ACE EV which features TML’s EVOGEN powertrain.

The existing Passenger Vehicle Range includes products like Tiago, Tigor, Altroz, Punch, Nexon, Harrier, and Safari.

Existing Electric Vehicle Range includes Tiago EV, Tigor EV, XPRES-T EV, Nexon EV, and NEXON EV MAX.

Also, the company boasts that the EV contribution is likely to increase to 25% in 5 years and reach 50% by 2030.

Apart from the portfolio mentioned above, TML offers a luxury range as well which includes Jaguar and Land Rover, the two distinct British brands with a rich heritage design.

Did you Know?

Tata Motors’ first indigenously developed passenger car, Tata Indica was presented in 1998 at the Geneva Motor Show.

Financial Statement Analysis

Key metrics.

Key Margins

Peer Comparison

Market details of tata motors, swot analysis.

• The company offers a diverse range of product portfolios including iconic brands like JLR which cater to the needs of a wide range of customers.
• Consistent investments in strategic partnerships and collaborations to infuse new technologies help the company expand its business operations.
• The company considers the quality and safety of the customers as key parameters while manufacturing products.
• Tata Motors invests heavily in research and development and tries to curate future-ready vehicles with features like electric mobility and connectivity.
• They actively promote sustainable practices through electric vehicles and emission reduction initiatives aligning with environmental concerns.
• A significant portion of its revenue comes from India , which exposes the company to economic fluctuations and regulatory changes in the country.
• Despite the pervasiveness of JLR, their presence in major global markets like China and North America remains limited.
• Dependence on imported materials exposes the company to price fluctuations , impacting the profit margins.
• The EV industry is dynamic as it changes quickly, failure to keep up with market trends may affect margins. 

Opportunities

• Tata Motors is well-positioned to capitalise on the rising demand for electric vehicles with their existing offerings and future developments.
• Consistent investments in research and development can lead to breakthroughs in areas like autonomous driving and connected cars, offering a competitive advantage.
• Government initiatives promoting EVs can create favourable market conditions for Tata Motors.
• They can leverage JLR to further expand their reach in international markets.
• Any kind of disruption in the supply chain can affect business operations.
• The company is exposed to several global economic and geopolitical situations such as wars, natural disasters, and pandemics.
• Sudden shifts in policy and environmental regulations can disrupt operations.
• Rapid advancements in technology can make existing products obsolete if they are not constantly updated.
• Brand positioning is a challenge in a dynamic automotive market with more intense competition from existing OEMs and new entrants in the market.

Tata Motors has indeed seen incredible growth in the Indian domestic market, especially in the commercial vehicle segment. Rising GDP and infrastructure spending can further boost the demand for commercial vehicles. New models such as Tiago, Nexon, and Harrier have been well-received by customers. Additionally, the company has captured the growing market segments with the latest designed EVs.

Tata Motors stands as a prominent player in the Indian automotive landscape, with a diversified product portfolio, strong brand recognition and a commitment to innovation and sustainability. Their business model positions them well for future growth. However, navigating and addressing key challenges will be critical for the company.

Frequently Asked Questions (FAQs)

1. Why is electric mobility a big focus for TML?

Ans. With India’s growing environmental concerns and rising fuel costs, electric vehicles represent a good solution.

2. Can Tata Motors become a global leader in the automotive industry?

Ans. The question cannot be answered yet but capitalising on opportunities will be important for them to compete on a global scale.

3. What are the latest innovations of the company?

Ans. TML is investing in connected car technology, autonomous driving, and many other revolutionary innovations.

4. Which company made the world’s cheapest car?

Ans. The iconic Tata Nano was the cheapest car ever sold and was produced with the objective of providing affordable mobility to people.

5. Does the company focus majorly on budget cars?

Ans. Tata Motors fulfil the diverse needs of customers by offering premium vehicles like Land Rover Discovery and budget friendly cars like Tata Punch. 

Disclaimer: The securities, funds, and strategies mentioned in this blog are purely for informational purposes and are not recommendations.

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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.

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Tata Motors, Tata Engineering and Locomotive Co Ltd (TELCO), Operations management, Tata Group, Supply chain management, Cost reduction, Tata Indica, Tata Indigo, Vendor management, Six Sigma quality, Tata business excellence model

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Tata Motors: Understanding risks in the supply chain

Automobile manufacturing has a complex value chain and requires a wide range of manmade materials which include highly refined composite materials and natural resources, such as water and sand, fossil fuels and grid power.

Tata Motors Limited (TML) conducted a natural capital assessment to identify key impacts and dependencies in our manufacturing operations. We sought to value and quantify associated environmental externalities. We wanted to better understand the embedded risks in our supply chain to be able to tackle them accordingly.

We identified water and silica sand as critical dependencies for closer evaluation because our plants include water intensive operations such as heat treatment, painting and machine shops. Silica sand is used in the manufacturing of ferrous and aluminum castings. 

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Key findings

We conducted our natural capital valuation using a value transfer method based on global and national environmental studies. Our analysis found that GHG emissions from manufacturing operations was, by far, the most significant impact driver, followed by non-hazardous waste disposal to landfill and use of fresh water. The exercise helped us to recognize embedded environmental and societal costs in our manufacturing process. Understanding water and silica sand as key dependencies will help us to de-risk our operations.

Going forward, TML intends to carry out natural capital assessments for other manufacturing sites in India. Our ongoing Sustainable Supply Chain initiative will complement this. We expect that the outcomes of these initiatives will provide insights to determine a way forward, inform our manufacturing strategy and outline ways to minimize the environmental impacts in our value chain.

More information

Tata Motors Sustainability Report 2016-17   http://corp-content.tatamotors.com.s3-ap-southeast-1.amazonaws.com/wp-content/uploads/2015/10/15092832/tml-sustainability-report-2016-2017.pdf

Arvind Bodhankar ( [email protected] )

Peter Dsouza ( [email protected] )

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Case Study: TATA-MOTORS

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Company url, tata motors limited is an indian multinational automotive manufacturing company headquartered in mumbai, maharashtra, india. it is a part of tata group, an indian conglomerate..

Its products include passenger cars, trucks, vans, coaches, busses, sports cars, construction equipment, and military vehicles.

Throughout the automotive industry, the name Tata Motors resonates with trust and supreme technology. They are known for their ability to provide cars that are based on the needs and desires of the Indian masses and their sprawling range of cars stand testimony to this.

The launch of new products is crucial for Tata Motors as the lifecycle of vehicles has now come down significantly to 6-8 years. Car buyers want the latest and new offerings and are willing to spend money on quality products. Now the challenge lies in connecting to these prospective buyers of the car.

Tata Motors was looking for  a lead generation solution which makes it easy for them to verify the interested customers and further engage them with marketing collaterals and book a test drive through their mobile phones.

Tata Motors was currently adopting different channels of marketing but did not generate the expected number of leads as there was not a proper CallToAction to their ads for the interested customers to respond to.

To meet these challenges, Tata Motors identified Orevento Communications Pvt Ltd as the solution provider. The challenge for us was to provide a straightforward solution to attract potential buyers of the car. Provide them with an easy and fun way to interact with Tata Motors. We proposed that they use our missed call engagement platform OneRing to equip CallToAction for their Ads. So they published OneRing’s missed call number on their Print Ads, Digital Ads and Tv Ads.

When the interested customers give a call on that number it gets disconnected after one ring. The caller details will be captured on OneRing’s AI-powered web panel which their marketing team can view in real-time. After that customer receives a call back from TATA Motors to ask about their interests and customers can even book a test drive in the nearest showroom.

Now, whenever TATA is launching a new car. They publish missed call numbers for customers to inquire about the features of the car and book a test drive. This way customer interaction becomes very easy and cost-friendly. People can inquire about the car and book a test drive without any cost. TATA saves a lot of cost for customer interaction and product awareness.

Tata Motors witnessed a tremendous increase in the incoming leads and inquiries post this solution was deployed.  A lot of potential buyers responded to the ads and gave missed calls who were later engaged by the TATA Motors marketing team. Tata adopted this method for the launch of all their new cars. Missed call engagement is very cost-effective and does not burden the potential buyers with any costs.

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