Tata Nano was supposed to be the ace up its sleeve which would propel Tata Motors to new heights, yet it instead became the poster-child of its perennial underachievement.
@TataMotors
Now the tables have turned, but how did Tata Motors mastermind this comeback?
A thread 🧵
@TataMotors
Now the tables have turned, but how did Tata Motors mastermind this comeback?
A thread 🧵
Challenges Faced
(1) Negative perception of its vehicles serving as more of taxis than personal vehicles
(2) Lacklustre product quality
(3) Insufficient post-sale servicing
(1) Negative perception of its vehicles serving as more of taxis than personal vehicles
(2) Lacklustre product quality
(3) Insufficient post-sale servicing
(4) Strong grip of incumbents like Maruti Suzuki India Limited and Hyundai Motor India Ltd.
(5) Intensifying competition from new entrants like Kia India and Morris Garages India
(5) Intensifying competition from new entrants like Kia India and Morris Garages India
Turnaround Strategy
(1) Geographic Focus:
Tata drew up a list of 21 of its worst performing cities and focused on shoring up geographic areas of weakness.
(2) Manufacturing Push:
(1) Geographic Focus:
Tata drew up a list of 21 of its worst performing cities and focused on shoring up geographic areas of weakness.
(2) Manufacturing Push:
While manufacturers around the globe are experiencing turbulence due to semiconductor shortage, Tata has soared above the clouds by -
► Purchasing directly from stockists
► Re-configuring cars to use less chips
► Changing the types of chips used
► Purchasing directly from stockists
► Re-configuring cars to use less chips
► Changing the types of chips used
On the capacity utilisation-front, Tata has been frugal and focused on optimising via removal of bottlenecks instead of making new factories.
(3) Product Mix:
As part of its ‘New Forever’ range, Tata placed an emphasis on SUVs in particular, with robust monthly sales.
(3) Product Mix:
As part of its ‘New Forever’ range, Tata placed an emphasis on SUVs in particular, with robust monthly sales.
Even the hatchback segment, which has been a stronghold of Maruti, has witnessed Tata making inroads, since its launch of Tiago.
Tata has also invested heavily in EVs.
Tata has also invested heavily in EVs.
(4) Pricing Strategy:
Targeting the mass market, Tata has spread its SUVs across a broad price range, from Tata Punch starting at Rs. 5.67 lakhs to Tata Safari going as high as Rs. 23.32 lakhs.
Targeting the mass market, Tata has spread its SUVs across a broad price range, from Tata Punch starting at Rs. 5.67 lakhs to Tata Safari going as high as Rs. 23.32 lakhs.
While EVs are often disparaged as being too expensive compared to their gasoline counterparts, Tata Nexon’s EV version starts at just Rs. 14.54 lakh.
(5) Marketing Strategy:
(5) Marketing Strategy:
Its top seller, Nexon, became the first made-in-India car to receive a 5-star crash test rating from GNCAP, which helped create a buzz around the superior safety of its vehicles
While Tata Nano may have been an abysmal failure due to its branding as “cheap”, “affordability” continues to be a key focus, with Tata Punch being the lowest priced SUV in India.
(6) Dealership Network:
The strong performance of its products has enthused the dealership network
(6) Dealership Network:
The strong performance of its products has enthused the dealership network
To digitise dealerships, Tata has launched a CRM tool - ‘My Leads App’.
It has also launched ‘Click to Drive’, an end-to-end online sales platform that integrates with on-ground dealerships.
It has also launched ‘Click to Drive’, an end-to-end online sales platform that integrates with on-ground dealerships.
The Outcome
2x market share of passenger vehicles segment over 5 years, growing to double digits, and trouncing Mahindra Group to capture 3rd place
Domination of the EV market, with 82% market share, up from just 18%, 3 years ago
2x market share of passenger vehicles segment over 5 years, growing to double digits, and trouncing Mahindra Group to capture 3rd place
Domination of the EV market, with 82% market share, up from just 18%, 3 years ago
Loading suggestions...