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MBI Presentation - Chandershekher Joshi

This document discusses Tata Motors' production capacity and orders for its Nano car. It analyzes the company's strengths, weaknesses, opportunities, and threats. It considers two models for market capture - 35% and 75% by 2014-2015. Model 1 targets the lower capture initially and allows for corrections, while investing profits in R&D and new plants. Both models provide the same yearly profit but Model 2 requires a new plant. The global market analysis identifies opportunities in emerging markets but also challenges of meeting local standards and maintaining a low price.

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Chander Shekher
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119 views8 pages

MBI Presentation - Chandershekher Joshi

This document discusses Tata Motors' production capacity and orders for its Nano car. It analyzes the company's strengths, weaknesses, opportunities, and threats. It considers two models for market capture - 35% and 75% by 2014-2015. Model 1 targets the lower capture initially and allows for corrections, while investing profits in R&D and new plants. Both models provide the same yearly profit but Model 2 requires a new plant. The global market analysis identifies opportunities in emerging markets but also challenges of meeting local standards and maintaining a low price.

Uploaded by

Chander Shekher
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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TAS Title

TAS 2011
TATA Consultancy Services Ltd Chandershekher Joshi

Agenda

Case Overview SWOT Analysis

Key Issues and Possible Solutions

Proposed Models Comparison Global Market Analysis

Reference

-2-

Case Overview
Production Figures
Pantnagar facility @ 50,000 car per annum
Sanad Facility @2,50,000 per annum starting April 2010 Capacity Improvement scope@ Sanand 3 Shift a day to achieve 3,50,000 capacity Upgrade infrastructure to achieve 5,00,000 capacity

Risks and Challenges


Customer dissatisfaction increase due to Long delay and frozen full cost as booking Amount Inflation

Macro economics

Market growth and Orders


Internal estimate is one million cars per year Total order received is 2,06,000 cars by May 2009 20,000 cars delivered by Feb 2010 45000 orders revoked due to long delay Pending Order pipe line : 161,000 Orders distribution: 50 % for LX, 30% for CX and 20% for Base model

Dfdfs

Break Even

Optimistic Production Output considering Business environment , macro economics (10-15 Days Downtime) 24,000 cars per month from April 2010 onwards And 4000 before it. Complete order flush out by Sep 2010 If continue with current production capacity Break even in 2056!!

SWOT Analysis
Strength
Low Cost ($2500 from base model to ) Designed to suit domestic market Requirements Large Market segment From rural India to Metros, Current two wheeler segment, Rich segment for additional car Close supplier manufacture relationship Long waiting time Low boot space No words of mouth support due to small

Weakness

consumer base (only 20,000 Car delivered )


Not a highway car with limited top speed

Opportunities
TATA brand name Reduce operating cost with diesel or Electronic versions Global Markets Increasing Domestic Customer Base Increasing Competition High Inflation rate

Threats

Safety standards and compliance

Key Issues and Possible Solutions


Production
How much production capacity
Company should plan for coming years How should production capacity Distributed to cater global demands What should be the market capture targets

Risks and Challenges


Macro economics and Global policies Region specific compliance Continue R&D to check increasing cost

Global competitor available in global market

Market growth and Orders

Investment Profit Ratio

Model 1 Target 35 % market capture Mini car segment CAGR is 50.4% from 2008-09 to 2013-14 Model 2 Target 75 % market capture Both model provide same YoY profit

Two wheeler CAGR is 8.8%

Proposed Models Comparison


Model 1 Market Capture @ 35 % Model 2 Market Capture @ 75 %

Xcx

Need of Hour -Hybrid Model

Model one is suitable for initial 4 years Require Production capacity is lesser than upgraded capacity from current two plants. A new plant is required to achieve 1 M car by 2014-15 as per Model two. Profit earn from model one can be redirected to R&D and New Plant generation. Model one in initial years will allow correction due to increase in competition and consumer feedback Model 2 in later years will allow to go beyond the domestic market. Global market required specific R&D to meet local safety standards and compliance. Divide domestic market into two geographic reason such that both plant serve a region to reduce transportation cost.

Global Market Analysis


Dxf

Opportunities

Challenges

2.3 M to 3 M demand for ULC cars TATA Motors current distribution and supply management system could be reused. Emerging Markets

Price increase in various market based on required safety and compliance May not be the cheapest car Market specific R&D required to keep price low New production and development models needs to developed suiting to target market

Reference
External Hyperlink
http://www.wikinvest.com/stock/Tata_Motors_(TTM)/Excise_Duty http://www.atkearney.com/index.php/Publications/a-nano-car-in-every-driveway.html http://www.zeenews.com/news546119.html?FORM=ZZNR5 http://www.atkearney.nl/global/images/global/pdf/Ultra-Low-Cost-Cars.pdf

Calculations

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