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Plateful of concerns at Tata Motors, but N Chandra’s top priority is domestic biz revival

21 February, 2018, Moneycontrol.com

Tata Motors has been working hard to upgrade its products lines and it was visible at the recently concluded Auto Expo

Though 85 percent of Tata Motors’ revenues comes from its Jaguar Land Rover (JLR) unit, its domestic operations have been under an intense scanner. This is not surprising considering domestically, the company had lost significant market share, in both car and truck segments. In fact, its standalone operations had been loss-making for four consecutive years.

Having taken over the reins of Tata Sons at this critical juncture, in early 2017, Natarajan Chandrasekaran had the tough task at hand of turning around Tata Motors’ domestic business at the top of his list.

The furious pace with which Chandra’s team worked to mend operations bore fruit in December, 2017 when the company reported its first profit in six quarters.

This was a result of several corrective steps taken in the preceding months such as fast tracking of delayed projects, pruning of costs, quicker ramp up in production, temporary shutdown of aspirational projects, and a human resource (HR) overhaul.

“Our clear focus is the turnaround of the domestic operations," Chandrasekaran declared at 72nd annual general meeting of Tata Motors in an attempt to appease shareholders who were irked by the company’s decision to skip dividend pay.

Only 10 months ago Tata Motors (along with its rivals) was accused of mismanagement when it failed to adjust to new emission norms at the start of the new year resulting into ballooning operating losses.

The company continued to produce huge volumes of Bharat Stage III (BS-III) commercial vehicles till the end of March, 2017 which were rendered useless after a Supreme Court order banned their sales. This was shortly followed by the abrupt exit of Ravindra Pisharody, the former Executive Director (commercial vehicles) from the company.

But since then the Mumbai-based company has managed to recoup some of its lost market share. It briefly regained the number three position in passenger vehicles, and is nearing 50 percent market share in commercial vehicles.

New products such as Tiago, Tigor, Nexon, Hexa have not only helped Tata Motors beat the industry average growth so far this year it has also helped it post the highest growth from the passenger vehicle industry.

“Chandrasekaran has shown a particularly keen interest in Tata Motors. He gets a briefing on a daily and weekly basis of the business from Guenter (Butschek, managing director) with whom he is working very closely. He comes for drives of product prototypes and production ready models. When it comes directly from the top it helps in reinforcing confidence in the employees”, said a top level executive of Tata Motors.

Chandrasekaran has repeatedly pushed for meeting product launch deadlines something that Tata Motors has been historically lethargic about. “We are focused on ensuring that all product launches happen within our laid down timelines without any delay”, Chandrasekaran had reassured shareholders at the AGM.

Tata Motors has been working hard to upgrade its products lines and it was visible at the recently concluded Auto Expo. Chandrasekaran unveiled the all-new premium sports utility vehicle H5X as well as the 45X, a premium hatchback at the Auto Expo 2018. Both concepts were received with tremendous response from the visitors.

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